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Peter Brimelow: Battered gold bugs still defying bear raid
By Peter Brimelow
MarketWatch.com
Monday, October 3, 2011
http://www.marketwatch.com/story/battered-gold-bugs-still-defying-bear-r...
NEW YORK -- Gold bugs have been shaken by the size of what they see as a manipulative bear raid, but they still believe that Asian offtake underpins the market.
Gold had been declining for several days, but in the early Asian hours of Monday Sept. 26 it was struck a terrific blow, plunging $130 in a few hours before recovering.
As Australia's The Privateer noted thoughtfully this weekend: "That plunge ... brought the gold price down pretty close to its 40-week (200-day) moving average. Gold hasn't been below that 200-day moving average by any more than a few [U.S. dollars] since late January 2009."
The break has provoked a great deal of suspicion. Veteran Ross Norman, now of the U.K. gold-dealing site Sharps Pixley, remarked of the sellers: "Placing such a huge order into the market when the least number of market participants were active tells you that they were out for dramatic effect. Anyone looking to offload significant amounts of metal at the best possible price would have done so when both London and New York were both [open]. ... Clearly finessing gold into the market was not their motive -- they wanted a statement."
... Dispatch continues below ...
Sona Drills 85.4g Gold/Ton Over 4 Metres at Elizabeth Gold Deposit,
Extending the Mineralization of the Southwest Vein on the Property
Company Press Release, October 27, 2010
VANCOUVER, British Columbia -- Sona Resources Corp. reports on five drillling holes in the third round of assay results from the recently completed drill program at its 100 percent-owned Elizabeth Gold Deposit Property in the Lillooet Mining District of southern British Columbia. Highlights from the diamond drilling include:
-- Hole E10-66 intersected 17.4g gold/ton over 1.54 metres.
-- Hole E10-67 intersected 96.4g gold/ton over 2.5 metres, including one assay interval of 383g of gold/ton over 0.5 metres.
-- Hole E10-69 intersected 85.4g gold/ton over 4.03 metres, including one assay interval of 230g gold/ton over 1 metre.
Four drill holes, E10-66 to E10-69, targeted the southwestern end of the Southwest Vein, and three of the holes have expanded the mineralized zone in that direction. The Southwest Vein gold mineralization has now been intersected over a strike length of 325 metres, with the deepest hole drilled less than 200 metres from surface.
"The assay results from the Southwest Zone quartz vein continue to be extremely positive," says John P. Thompson, Sona's president and CEO. "We are expanding the Southwest Vein, and this high-grade gold mineralization remains wide open down dip and along strike to the southwest."
For the company's full press release, please visit:
http://sonaresources.com/_resources/news/SONA_NR19_2010.pdf
The plunge has also stimulated some interesting work. Bullion bank HSBC published an essay Thursday saying: "The drop in gold prices last week represented a 3-standard-deviation move, down 8.54%. ... This has occurred only seven times since gold became freely convertible in 1972."
Taking the rather more calming long view, Bianco Research on Tuesday put out a piece noting that, considering the nine major breaks since gold started rising in 2001 in percentage terms, the break from the Sept. 6 $1,924 high to last Monday was the second shallowest, and was less severe than the previous five.
In gold, a $100 move is not what it was!
As usual, the radical gold bugs to be found around the banner of LeMetropoleCafe turned quite cheerful on the break. The Asian physical markets began to show high gold premiums to the world market, indicating import demand, upon which this group sets so much store. By the end of the week, India, China, Vietnam, and Turkey were reportedly in this mode.
Analysts at two bullion banks concurred. On Tuesday Edel Tully at UBS commented: "To be clear, physical demand right now is not just decent, it is exceptionally strong. And while Friday's volumes mirrored flows not seen since late January this year, demand yesterday was a good deal more impressive."
Standard Bank noted on Thursday: "Although buying interest out of India has been particularly strong, support is broad-based throughout Asia, with physical demand in places like Thailand and China also rising." On a year-on-year basis, "current buying momentum is much stronger than the respective comparable periods in 2009 and 2010."
On Friday "Dave from Denver," a regular correspondent at LeMetropoleCafe, ventured: "Hate to say the bottom is in, but it sure feels like, barring a complete market collapse, we may have seen the lows in gold/silver."
A thought shared by the by-no-means-gold-buggish Gartman Letter on Friday: "It does indeed appear that the worst has been seen in gold, and that the panic lows seen Monday in Asian trading have held. ... We have weathered the storm."
The Privateer's conclusion: "Look upon this correction as an enhanced opportunity to add to holdings or, if you haven't got any gold yet (why not?) to start accumulating."
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Prophecy Platinum Drills 120.9 Meters
Grading 1.26 g/t PGM+Au at Yukon Wellgreen Project
Company Press Release
Monday, September 26, 2011
VANCOUVER, British Columbia, Canada -- Prophecy Platinum Corp. (TSX-V: NKL, OTC-QX: PNIKF, Frankfurt: P94P) has announced the drill results received from its 2011 drilling Wellgreen platinum group elements, nickel, and copper project in the Yukon Territory.
Borehole WS11-188 encountered 457 meters of mineralization grading 0.47% nickel equivalent (including 0.72 grams per ton platinum, paladium, and gold) from surface to the footwall contact. Within this larger swath of mineralization, the hole encountered a high-grade section of 17.8 meters of 3.14 grams per ton platinum, palladium, and gold, 1.03% nickel, and 0.74% copper (1.77% nickel equivalent).
The hole was drilled completely outside of current resource boundaries, between the East Zone resource and the West Zone resource that was reported in the company's press release no July 14, 2011.
The high-grade intercept located between the two resources not only demonstrates that the East and West Zone resource form a single, geologically contiguous body but also indicates that the higher-grade material in the East Zone continues to the west and at depth at Wellgreen.
For drill result tables and maps, please see the company's full press release here:
http://www.prophecyplat.com/news_2011_sep26_prophecy_platinum_wellgreen_...
