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Maybe the CB's are waiting till seasonally strong Sept to sell. Wonder if it'll be muted this year. Obviously if they don't come close to their quota it'll be a very bullish sign. 1st year in how many?
Not selling any NG shares this time above 17. NG has said they expect to release drill results from Galore soon. I expect a decent increase in reserves. Not sure if it'll be good for a further pop, but it'll raise the floor under the stock even higher even in a worse case ABX scenario. Feeling confident that NG will get 70% of Donlin, but not sure how long it may get tied up in litigation.
Did some partial selling in other gold shares as GG and NEM are still acting weak. I don't see huge downside for gold here, but until things start acting better not going to get too heavily exposed. Did some selling mostly so I can do more buying again if we retest or break the recent lows w/out getting ridiculously overweight PMs.
About 18% NG in largest account, 15% other PMs, about 6% short S&P, 3% misc longs and the rest cash.
NG - Rock creek update
Looks like they still need 1 more permit. Still good news that they got the others.
http://messages.finance.yahoo.com/Basic_Materials/Gold_and_Silver/threadview?m=tm&bn=24339&t...
Gold typically focuses more on econ news vs geo-political. The retail sales is a lagging indicator. The inflation news doesn't justify $30 off the highs in 2 days. Again I think this is mostly manipulation and ST running the stops. PMs may still be tracking the broad market as well. Either way it's time to accumulate. Not time to go all in, but at least accumulate on weakness.
(dup eom)
Gold/PMs - Once again we're down almost $20 off the highs in very short order on nothing fundamental. Anybody's guess as to where we stop the next few days since it looks like the stops are being run. I'm starting to buy back again, but lightly so far. I can't see going much below $600 again unless the market feels the Fed has to raise more. Since the Fed just went on hold and they've said inflation is lagging (your choice whether or not you want to believe that...) I can't see them hiking in Sept and we're almost to the sweet spot from a seasonal standpoint. May buy more later today as these types of smackdown are more often buying ops vs the start of something big. TA wise makes sense to wait till closer to 320 HUI, but FA wise and sentiment wise I like adding some here.
PM action really weak considering. Was expecting more follow thru today. Guess we have a bit more work on the downside. Reduced PMs again, but still have all the NG and not planning on touching GSS for a while (unless I buy more). Dumped HMY and sold higher cost shares of CDE. About 30% PMs here (in largest acct) , but half is NG which I don't see as having too much downside here.
NG - Rock Creek update
http://messages.finance.yahoo.com/Basic_Materials/Gold_and_Silver/threadview?m=tm&bn=24339&t...
Looks like it may have been fully permitted, but if so there should be PR shortly and nothing yet. If true should be good for a little pop this morn.
W/you on CDE. Consider it more of a trader. Needs to stay around these levels or $5 will be seen rather quick. Have about 1/2 of what I would want. Also picked up more GSS today. These artificial smackdowns are usually good buying ops. Anytime you see gold down $15 on essentially no news (or news that should make it go higher - airline plot) it's artificial. Tsy autions rapping up so maybe one more down day tomorrow, but IT things looking better here imho.
Starting buying back NG shares sold above 17 at 16.5 and below today. Will keep buying every .50 or so. Already bought back everything I sold and a bit more.
Thanks. Posted to the Yahoo NG board a while back. Bit of a stretch as nobody would pay that kind of premium, but it does help put things in perspective. I love NG's potential LT and $100, 4 years from now if they remained independent wouldn't surprise me, but at this stage I don't think the market will pay more than $25-30 even in a bidding war. A year from now that could change. I could be wrong, but there's still a good deal of cap-ex ahead, permits, etc. Right now I think the best case for shareholders for the ST and IT would be for ABX to buy just Donlin. Question is would they pay a fair price. If they got a substantial influx of cash the new floor could be north of $20 and maybe not require any new funding for Galore while still having substantial upside. One thing I believe in is NG ability to find new resources. I think it would be the best of both worlds (at the right price of course). We'll see.
I can't see ABX going away quietly and go away is what we need them to do. Giving them Donlin in exhange for cash and PSM shares is probably what they've been after from day 1.
NG update
ABX conf call this morn. Will be interesting to see if analyst or callers reference NG SEC doc released yesterday.
CMP acquisition closed. May put a little ST pressure on the stock as these shareholders are probably not as likely to hold LT.
http://biz.yahoo.com/iw/060803/0150507.html
Sold a little at the open just in the 1 acct where I was very overloaded. Sold the calls as well. We appear to be at the top of the range unless we get some news. The risk/reward ST appears about equal.
Agree good summary of where things stand especially the comparision of other buyouts. I thought it was slightly misleading as they included producers in the list. DEZ was essentially producing when it was bought out. NG may be producing in 2007, but the bulk of their production won't come till 2010 and now Donlin looks to be tied up a bit. I think $60+ would be somewhat fair given that neither Donlin and Galore are permitted yet and both require quite a bit of cap ex That would imply a price around $25. I can't see Barrick going that high given their initial bid unless another bidder arrives. I would love to end up w/GG shares and I'd setttle for NEM. Right now I'm beginning to think NG will stay independent and the market will simply reject Barrick's offer. I'm not sure how much NG is shopping itself around as much as they're simply trying to stop Barrick. Management believes quite rightly that there's far more money to be made staying independent vs getting $25-30 max now.
If Donlin or Galore were closer to production (or simply fully permitted) I'd say that NG should sell more like $100-120/oz, but given the time value of money and uncertainty $60/oz would seem fair at stage of the game.
The market bid up NG today maybe thinking that ABX would increase their offer today when they announced earnings. I can't see a big pullback tomorrow based on no news, but if nothing emerges from another buyer I can't see going too much higher either without news.
I'm a little confused on why NG didn't play hardball ealier. If their hand is strong why give ABX an easy way out on Donlin let alone partial ownership of Galore. Also I wonder what their agreement is w/ABX w/respect to new drilling on Donlin if they'll get access or if they can't see the BFS until completed. I expect both Galore and Donlin to have substantial resource additions as they make their way to full feasibility. This is certainly an interesting saga. Time is on NG's side here.
>> As for NG IAC I see many potential outcomes and would hesitate to feel so safe, a nice gain thus far why not take it and reallocate, I would hope you are not increasing % portfolio exposure based upon fales sense of safety here. You realize that if you had cashed in recently you would have made better gains in most every other miner since. It is stuck until the next chapter, can you predict that chapter well enough? Are you willing to pay time value to wait. MY NG money has been working elsewhere. <<
I've been relatively high cash over the past 6 months so even w/an overweight position it's not like I'm hurting for cash - yet. If that changes and something looks very compelling then I may sell NG. I think there are three likely scenarios here:
1) ABX takes away bid - for now. No other buyer shows up. Stock price may drop back to 14-15 range, but NG survives.
2) ABX buys just Donlin for somewhere around 1 bil and PSM shares. NG shares probably would trade anywhere from 16-18 on the low side to 22-24+ on the high side as they would have all cash they need to develop Galore.
3) ABX ups offer or another buyer comes thru w/price around 20+.
I really don't mind any of these scenarios. For the most part I just have my original shares. If it gets to sub 16 again I may add again. I did buy a small amount of Sept 17.5 calls in one account for .35 so don't mind if they don't hit.
I'm already 7 months in for LT gains. If the right buyer emerges I'll probably continue to hold LT. Probably not as interested in holding ABX, but may hedge my position if ABX bids higher because as it stands currently NG unrealized gains represent half my total realized gains for the year and I'm really tired of not even being able to deduct my kids on my taxes. That's the plan.
As for ABX bid...
http://messages.finance.yahoo.com/Basic_Materials/Gold_and_Silver/threadview?m=tm&bn=24339&t...
Picked up GSS and HMY myself. Increasing exposure partly since I think we'll get some sort of pre or post Fed gold bounce and since NG likely to hold above 15/15.5 even if the sector gets hit hard.
Ole Sly is at it again. He's starting to pipe up again so maybe we're at a ST or IT low here based on his past posts. He's been bashing gold for the most part since HUI 150 where he stepped off the ride.
http://www.siliconinvestor.com/readmsg.aspx?msgid=22670786
Probably his worst post I've seen in a long time. Totally ignores fundamental reality. Ignores long term ratio charts such as gold/oil and dow/gold as well.
I think he's trying far too hard to be a contrarian here. He's certainly made some good calls in the past, but this ain't one of them.
There's little incentive to "take it" as Doody says. He was probably telling his subscribers to take it at 15.5. Just by the fact that it's trading this high already (imho) says the final bid is likely to be at least above current market prices. W/each day that passes a bid at 20+ is looking more likely. There are no other Novagold's out there. That's what most market participants don't understand. Sure the majors can takeover other plays, but nothing that gives this many resources this fast in politically secure areas. It's interesting that nobody talks Barrick sitting on drill results from Donlin or potential results from Galore. In talking w/IR about 6 months back I got a strong impression that both mines would likely see big gains in their resources. This certainly has been interesting. I would love more, but I'll be pretty happy at 20+.
HUI - Retesting breakout area on 30 min
Last good buying op for a while or start of another leg down to retest the 280 lows?
http://www.investorshub.com/boards/read_msg.asp?message_id=12235297
FA wise I favor the first scenario given the Fed on Aug 8th and even if we get another hike I expect them to go on hold.
TA wise PMs looking like they're still tracking the market especially on today's swoon. Very ugly action today.
>> 1) An agreed merger with a white knight at a much higher shareprice. The obvious candidates could include GG, NEM, K, and a handful of others. The Copper at Galore creek could entice Teck, while Phelps Dodge is currently intricated in a complex merger attempt with Inco and Falconbridge, and maybe sidelined from looking at NG. <<
I wouldn't mind owning GG or potentially NEM long term. GG of course would be my first choice. Much higher share price? Wonder what numbers the author has in mind. If it's technically only costing ABX 150 mil then the case could easily be made that they're willing to go as high as $25-30. I think the market might punish them initially for this, but IT, LT would see the value. Not sure if I could see another major coming in that high initially. I think the next offer would be around $18-20 US, but doesn't mean it's the final offer. I tend to think around $20 US with 22-24 possible. Again thanks for the link/read.
$20 US. I'm basing it more on a premium to where NG was at it's highest pt along w/overall value of the company and $xx/oz of gold in the ground relative to other takeovers. I think $20 is likely, but if another buyer comes in we could see more like $22-24. The majors are desperate to increase resources and production. NG more than fits the bill especially w/mine locations as well.
Don't follow BGO, sorry. Putin scares me.
Guaging a top is probably one of the toughest things to do imho. It's far easier to pick a bottom. When guaging a top you can look at all sort of technical indicators of course which everyone has their favs. FA wise I'd look at how the stock reacts to good news/bad news. What's sentiment like? What's are message boards like? Options? What future catalysts exists ST/LT to drive the stock higher. Is all the good news already priced in? Premium to peers? Premium of sector to other sectors?. Really much more of an art than a science. Bottom picking you can certainly use the same tools, but at some pt basic accounting kicks in.
Interesting that ABX continues to gain today along w/NG. Doesn't look like the market thinks ABX is paying too much even w/NG now 11% above the offer price. If ABX ends up w/NG it'll probably be around $20, if another bidder arrives then it's possible to see $22-24 imho.
Interesting HUI chart on 30 min. Should break higher eventually, but looks like it needs one more wave lower. Also PMs rising on low volume and w/the gen market.
Novagold responds to Barrick
http://www.siliconinvestor.com/readmsg.aspx?msgid=22654947
NG - As usual Patriot is very sharp. I love this idea. Depending upon how NG responds and if the stock is still under $16 I may add more tomorrow even though I'm already pretty loaded. % wise I don't think I would add more than 25% to my existing shares, but who knows.
http://messages.finance.yahoo.com/Basic_Materials/Gold_and_Silver/threadview?m=tm&bn=24339&t...
>> This is a brain teaser for people who really know NG and the beautiful contract they have on DC. I don’t want a white night! I have no say so I’ll take what I can get. BUT, NG has much more leverage than ABX pretends to have got by sleazily buying PSM. Grace may add $150mn max to GC capex worst case. That’s it. ABX will NOT earn its 70% in DC. They don’t have time. That’s leverage. NG cannot use it though. NEM can. How much will NEM pay for a 99% chance at 70% and control of DC. They are struggling to keep above 6mn ounces per year. Ya think they might want a high odds shot at an extra 1-2mn ounces by 2010?? So what could ABX lose? 1-2mn ounces per year. Hmmm…Who has whom over a barrel. We will see if NG has this or other creative solutions up its sleeve. Unlike PSM, NG has real value and not nuisance value. I refuse to accept that they did not foresee this and do more than a SH agreement. If I am wrong, I will sell with pleasure. F##k em. They have my respect and loyalty only as long as they deserve it. For now. I will watch with interest. <<
NG - Thanks for the link. What I take away is that while the first offer for PSM was probably a fair offer it set the stage for this whole takeover. While I think NG should/would probably prevail over Barrick/PSM in the dispute allowing Barrick to pick up PSM does give them some leverage. I still think NG will fetch a better price eventually, but had they come in w/a higher offer immediately for PSM it would have decreased Barrick's leverage (if they could have got enough shares to block) and maybe Barrick would have waited like many majors until NG was closer to production (reducing uncertainty). It doesn't make any sense to come in so much higher than the NG offer for PSM unless they're going to use it for leverage. The fact that NG was willing to buy PSM vs fight might have caused ABX to examine it more closely. Opinion?
I'm eager to hear NG's response and hoping if possible they'll release more drill results ASAP.
Re: NG - Well I didn't listen to the ABX CC yet, but I don't see why this would be false.
http://messages.finance.yahoo.com/Basic_Materials/Gold_and_Silver/threadview?m=tm&bn=24339&t...
>> If anyone thinks this deal is going through at this price listen to the ABX CC. At about the 28th minute a guy from Neuberger Berman (owner of 11% of shares out) called in to ask questions. He seemed insulted that Barrick had not talked to them about this offer before announcing it. He closed by saying, "Good luck!" (in trying to amass 75% approval). <<
Glad we both held today and that we both agree that higher prices are coming still. I'm thinking something around 20 is about what we'll get even though a year from now I think we could get 25+ with POG above 600 and course much higher LT. I've got mixed emotions on this deal obviously.
NG hasn't even responded to offer. The offer is too ridiculously cheap. I haven't sold but maybe 5% of my overall shares.
NG has done a lot of drilling of late (last 6-12 months). I would suspect they could release some of these results any day now which alone might justify an even higher price. Most buyout of exploration plays have been anywhere from $40-80 per share. This is definately on the low end and given NG's prospects and mine locations this is an absolutely joke. Rock Creek permits are likely coming soon which would further add value. I think this gets taken out, but more like $18-22 (and that is still too cheap imho). Look what this buyout does for ABX's resources. It's nuts and this is prior to major drill results coming in the next few days/months.
Yea they've taken out not only all the geo-political premium, but some of the post Fed-is-done bounce as well. Still IT and LT wise could fall further, but NG's news is why I doubt I'll be complete out of the sector at any pt in time. Always a good value out there somewhere. My guess is Barrick will have to increase the offer. Markets already trading more than $1 higher than the offer which is unusual. Only problem is not too many companies can afford NG at it's "proper" price.
Also ABX not dropping much on the deal either. I think the markets realize that $20+ would still be a good deal for Barrick.
Barrick offers 14.5 US for Novagold (what a joke)
http://www.ccnmatthews.com/news/releases/show.jsp?action=showRelease&searchText=false&showTe....
Was expecting more like 18-20 range if we had a buyout here (still cheap LT). Novagold should release more drill results from Galore or Donlin which would probably help. Will probably hold as higher prices are likely coming.
OT - My latest read on PFE. Looks good here. Relatively safe since earnings are past now as well.
http://www.investorshub.com/boards/read_msg.asp?message_id=12142248
PFE looks pretty good IT. Been showing good relative strength of late. Positive divergence on the daily. Affirmed guidance this morning (upped it if you consider the pending asset sale). Breaking above 200 dma and downtrend channel. Good sector strength going forward w/slowing consumer. Added to existing position today (from mid 22's).
Could also be an inverse H&S in the making on the weekly. Once again positive divergence there as well.
I think they may raise at this next meeting, but even if they do I'm assuming we'll get more clear signals that they are going to pause for a while. Between high oil prices, war in the ME, signs that the economy is already slowing down and the lagging impact of both interest rates and CPI I suspect that's the case. Of course the volume today in gold shares leaves much to be desired. Looks like a trading range for gold and PM shares for the next few months. I wanted a bit higher core in case I'm wrong and gold does continue to strengthen, but I"m nowhere close to being convinced we're out of the woods yet.
Ben's speech today obviously convinced the markets he's more dovish as they went from 90% chance of hike in August after CPI to around 50/50 and almost nothing after that. Obviously data dependent.
Dumping the rest of EBAY prior to earnings. Too much of a crap shoot very ST and not acting very well especially on a day like today. YHOO spillover effect, but still should be better. Also added to PM long positions now that some of the geo-political premium has come out and the Fed is looking more dovish. Probably 20% PMs now overall.
Last on post on CWPC for a whille:
http://www.siliconinvestor.com/readmsg.aspx?msgid=22631421
You do know that you're the Falcon, right? Just checking.
EBAY showing pos divergences on weekly, daily and 30 min. Don't do much w/EW, but it does look like a giant ABC off the highs. Lastly even w/a slowing consumer I can't see EBAY missing big. You could make the argument that it would help their business as more people would probably trade. Now I think they overpaid w/Skype and it's possible their growth rate is slowing enough to reflect what's in the stock so I probably will hedge my bets and probably partially sell ahead of earnigns since I don't follow the FA story close enough.
Kudos on hitting HUI to the short side. I handled the downturn better than any previous, but I'm sure like many missed the bulk of the recent rise (w/trading shares). Hard to have it both ways.
(dup eom)
EBAY looks pretty washed out TA/FA wise. Bought some at the open as well as just now for a ST trade. Earnings on Wed. Will probably sell half prior regardless.
I'm not completely out of PMs here as I've noted from my core holdings so I wouldn't mind too much missing out on some potential ST profits. The HUI did firm and I was tempted near the close, but this last 30-40+ run in gold prices in entirely geo-political. Even if we reach 700+ on gold I doubt you're going to get a huge surge in gold shares, maybe 10% at most. When gold does get hit again on less tension in the ME or elsewhere the downside will come fast and the bids will disappear. Some of this is already reflected by the shares lagging, but as usual there will probably be more due to shorts/weak longs, etc. I do think what's happening w/the markets and the ME should put the Fed on hold now for August so maybe that'll get reflected soon in the markets and gold (IT). Even a small pullback for gold/gold shares would be very healthy here.
COTs don't matter as much anymore, but today they also confirmed that this is likely just a ST surge in gold vs the start of a new IT.
Gold comfortably above 660-665 area now, but shares definately acting weak in the face of gold strength so I will not be adding new positions here. Could still go either way ST. Don't expect much, if any resolution out of G8 that would convince Isreal to stop on it's own which should argue for continued instability next week. That said I think odds are against Iran or Syria getting directly involved (just a swag of course).
More news on NG grace w/respect to PSM.TO dispute
http://biz.yahoo.com/iw/060714/0144320.html
Granted I'm biased, but looking at the data that NG is presenting here it's hard to make the case as PSM is asserting that there's mineable resources on the grace claims. NG's offer to buy PSM is set to expire soon. I think this is just a shakedown for money on the part of PSM thinking they can delay Galore and thereby get NG to throw some money their way in same manner that lawyers go after any stock that declines in value. I don't see it having a material impact on NG either way LT, but ST still possible to cause NG some issues (even though I think the evidence favors their side).