American Pacific Mining Is Gearing Up At Tuscarora – Mike Swanson (07/04/2018)
American Pacific Mining Is Gearing Up At Tuscarora – Mike Swanson (07/04/2018)
As you know I own lots of individual stock positions and at times invest in pre-IPO stocks in private placements. When I get opportunities to buy a pre-IPO stock I usually let my private Power Investor members know about them. David Skarica, who I talk with often, has made these type of situations his main focus as it really takes a lot of work to sift through them to find the best deals, but the profit opportunity can be tremendous when you get in a good one. For instance I bought a dope deal last year in a private placement that is currently trading at over 5X the price I got in at.
We are seeing some positive developments with mining stocks this month as the GDX is starting to turn up after the price of gold briefly fell through the $1250 level. Positive divergences are forming and if they lead to a big bull wave I’ll likely buy more private placements in mining companies.
Usually these stocks start to trade a few months after the financing, although at the moment I have two that have been held up for a year. There is often a four month holding period on the stocks, meaning that you can’t sell them for at least four months after they trade.
Sometimes the holding periods can be even longer, but regardless I usually wait a month or so after they trade before I talk much about them, because they can often get hit by some initial selling for a few months as some people who bought the financings take their profits and sell.
The best ones when they dip typically base out for a few weeks to form a clearly defined support and resistance zone and then breakout to the upside to begin a nice run that can last a long time.
One stock that I bought in a private placement last year and have not sold a single share of is American Pacific Mining. It trades on the CSE under the symbol USGD and on the US pink sheets under USGDF. It is currently basing with support at 17 cents and resistance of 22 cents. If it closes above 22 cents this month I expect we’ll see it make a run to 30 and then finally even beyond that. The reason why it can do that is not just the chart. It simply has a super cheap valuation.
The stock is trading with a market cap of only $7 million dollars and is a gold exploration company focused on precious metal opportunities in the Western United States. In bull cycles most exploration stocks reach market caps of at least $30 million. It’s main target is Tuscarora, which is a high grade, early stage gold project located in a prime precious metal district in Nevada, only 35km northeast of the Carlin trend, 20km southwest of the Jerritt Canyon deposit, and 50km east-northeast of the Midas deposit. American Pacific is eyeing a gold discovery amidst gold’s next bull market. Take a look at the chart.
You can see the simple consolidation pattern on the chart. If it pauses here more and then breaks 22 cents it should make for a fun trading setup. American Pacific Mining started to drill this property a few weeks ago and has already had some promising initial results. The company put out a press release last week with these details:
Highlights from the first five holes are reported below, including high-grade intercepts from the oxide mineralization known as the South Navajo Vein Zone.
Eric Saderholm, President of American Pacific Mining, commented: “We are really pleased with these initial results at Tuscarora. We hit the bedrock zone approximately where we anticipated hitting it, and the significant intervals of high-grade are consistent with those seen in previous drill campaigns. It is particularly encouraging to see that hole APTU18-009, where we encountered 3 meters of 9.39 g/t including 1.5 meters of 16.0 g/t gold, was not a twinned hole, but rather was located 60 meters north of previously drilled areas.”
“Assays are pending from eleven remaining holes, and after receiving these we will begin to develop a 3D model and a timeline for Phase 2 drilling,” commented Warwick Smith, CEO of American Pacific Mining. “There is a lot of unexplored acreage at Tuscarora, we look forward to continuing exploration on the Navajo Vein, the East Pediment Zone and between these zones where there is a further chance for gold discovery.”
American Pacific is now in the process of separating out high-grade samples to be re- assayed via Screen Metallic Analysis to compare to the Fire Assay results. In the past, previous operators saw some assays had a wide variance of grade when comparing Fire Assays to Screen Metallic. This is quite common in higher grade vein systems containing coarse gold. Screen Metallic analysis determines the content in both the coarse and fine material after the screening process, whereby the coarse material analysis is done separately, with the fine material usually analyzed in duplicate to achieve an average value. For systems with coarse gold Screen Metallic Analysis can be a more accurate and representative method of analysis. All samples that return 1 gram or better in the fire assay will be re-analyzed using this Screen Metallic method. Screen Metallic and duplicate assay work will be performed by the accredited ALS Global Laboratory.
All assay numbers are reported as un-cut and all intercepts are reported as drill width and are not to be interpreted as true widths.
You can read more about the company by going to their website:
With more drill results to come this summer this could become an exciting year for American Pacific Shareholders. I certainly hope so, but the thing is it takes higher prices to get the masses interested in buying. So a move through 22 cents is what it will take to make people chase it up and up and up. Bob Moriarty of 321gold.com just put out a report on the stock this week.
Now I’m in no hurry to sell the stock myself and haven’t even deposited my shares with my broker yet. They are part of my speculative portfolio and I don’t ever put more than 3% of my money into any individual stock position long or short. But because this is a small cap stock with a market cap under $100 million dollars I will not buy or sell a share of American Pacific Mining for at least 30-days from the date of this report, which is July 4, 2018. Really I am not looking to sell until much later, but in small cap situations like this where I make a report like you are reading I create a self-imposed 30-day trading rule when I talk about them.
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