Falcon Gold (FG.V) is a junior explorer that acquires, explores, and advances quality mining projects in the Americas. Their assets are in Canada, Chile and Argentina with their flagship project being Central Canada and bordering Agnico Eagle Mines 4.6 million ounce Hammond Reef deposit.
The majority of their properties are next to large proven deposits. Which means the veins could extend onto their land. This creates an exciting prospect for drill results. Major catalysts for the stock price. The hope is one of these assets hits something big and more drilling begins to unveil a resource. Then, perhaps a larger miner jumps in with a joint venture, or just straight up buys the asset.
For those who follow the mining industry in depth, you probably know that many majors have not spent too much money on exploration. This creates a great environment for junior explorers. If Agnico is running out of Gold and want to expand their resource, they will pay attention to the drill results that Falcon Gold are pulling out of the ground. Maybe even a potential joint venture funding Falcon’s drilling, and downright acquiring the land from Falcon a bit later.
Recent news details Falcon gold acquiring a large and prospective land position in the Valentine Lake South area. This new land position consisting of 605 claims (15,300 hectares) is contiguous to Marvel Discovery Corp, Matador Mining, and Tru Precious Metals Corp (TRU). The Property also lies along strike from the Valentine gold deposit which hosts 6.8 million ounces of gold, and is now under development.
Falcon’s goal is to commence surveys once the exploration permits are approved.
I also want to remind readers that there is a major catalyst upcoming. Falcon gold is beginning their phase III drill program at the Central Canada property this month. To date Falcon has completed 26 diamond drill holes totaling 4,058m since 2020. Phase III is planned for 3 holes totaling approximately 1,000m. This is very important given what we see on the technical charts.
The technicals have me salivating. I want to remind readers that I outlined the reversal pattern here back on January 19th 2022.
We got that technical breakout above $0.075, but just no momentum higher. We even had a pullback to retest $0.075 as expected on breakouts. We developed a tiny range between $0.075 and $0.09.
The breakout finally came on March 16th 2022. Breakouts are important, and the two things that make a breakout powerful is the size of the candle and the volume. Obviously we want a strong green body candle. In terms of volume, we want to see figures that are above normal. We saw this on the 16th. Breakout volume came in at 680,500 shares. The most since September 23rd 2021!
An ascending triangle is a chart pattern used in technical analysis. It is created by price moves that allow for a horizontal line to be drawn along the swing highs and a rising trendline to be drawn along the swing lows. The two lines form a triangle. Traders often watch for breakouts from triangle patterns.
$0.09 becomes major support, and notice how buyers stepped in at the uptrend line near $0.085. The market is respecting this technical pattern. There are two ways to play this. Either enter here if the stock begins to hold above $0.09 and ranges for a few more days. Or the more prudent approach, wait for a break and close above $0.10 so you can ride the breakout momentum. We do have some resistance at $0.12, but if gold continues to rally, many of these juniors will rally.
I think Falcon gold from a long term risk vs reward perspective presents gold bulls with a great opportunity to initiate a position here. We do also have that catalyst from phase III drill results coming, and the technicals are being respected by market participants.
