Kaminak Gold Corp. is about to anwer a lot of questions about their Coffee Deposit

Apr 1st, 2011 – 1 Comment

  Hi Lou! What do you think about KAMINAK GOLD? At the current price, is it a good investment? Thanks Yves   Hi Yves, Thanks for the assignment. This is the second junior exploration company that has surfaced this week which has created an incredible amount of wealth. Kaminak Gold Corp. ( KAM TSXV) has […]


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Hi Lou!
What do you think about KAMINAK GOLD? At the current price, is it a good investment?

Thanks

Yves

 

Hi Yves,

Thanks for the assignment. This is the second junior exploration company that has surfaced this week which has created an incredible amount of wealth. Kaminak Gold Corp. ( KAM TSXV) has had an impressive move from the October 2008 low of $0.14 to its current price of $3.23. A twenty three bagger is never to be ignored or slighted. But keep in mind these higher risk prospects are speculations more than investments.

 In the research that I have conducted I can appreciate the business model that management is following. They explore for deposits and take the their targets to the discovery stage. They don’t build mines. In all aspects of business if you know what you are good at and like doing you will tend to be successful. The charts will provide some information regarding an entry point.

The three year chart depicts the dramatic advance KAM has enjoyed but there has been a flattening out of the trend since August of 2010. It makes sense that as the company advanced their Coffee Project in the Yukon Territory investors have come to need more and more information about the deposit to get off their wallets and buy. In the early stages the prospect of a high value opportunity along with rising gold prices were enough to push buying momentum. Now the market wants more and better particulars. The company plans on spending $15 million in 2011 to further delineate the deposit which should answer a lot of questions.

The six month chart illustrates the support at $2.70 and the resistance at $4.00. The MACD generated a buy signal in late January of 2011 as the stock bounced off of $2.70 and a sell signal as it approached resistance at $4.00 in early March. A very healthy return for just over a month in the market!

Given the amount of drilling that KAM plans to start in mid April and what looks like support along the 50 day moving average at $3.20. you could enter at this level. If it fails to hold here you have support at $2.70 which is a 15.6% pull back. A bounce off of $3.20 would still meet resistance at $4.00 so have a trading plan in mind if you jump in now.

MAKE IT A MASSIVE WEEKEND AND HAPPY CAPITALISM!

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