As Stocks Enter Bear Market, Silver Shines

Published on: February 4, 2022
Author: NAI500

Silver Price Is on The Move

Three weeks into 2022, stocks are getting hammered. The NASDAQ, DOW, S&P500 are all down from where they started the year – and still falling. However, it’s not all bad news. Precious metals are also on the move, moving upwards towards highs not seen since last November. Silver price have been seeing a lot of bullish momentum and could be getting ready to make a breakout move. Meanwhile, gold has been steadily testing resistance at $1,850 per ounce.

There are several reasons to be optimistic about gold and silver prices, the most significant of which is the current price action. Red hot inflation and geopolitical concerns aside, price action has caused a break in key resistance levels, reversing trendlines and creating significant upside potential.

Why Silver Stocks are Rallying

Thus far, 2022 has not been good for stock investors. Inflation is running rampant, tensions with Russia are at an all-time high, and supply-chain disruptions are all weighing heavily on investors.

The US Federal Reserve has taken its first steps in tightening monetary policy with an announcement Wednesday that they are planning for three rate increases, beginning as “soon” as March. And while markets initially reacted well in anticipation of the news, gains were short-lived. Amid economic uncertainty and increasing volatility, safe-haven assets like silver could become increasingly attractive.

Last week, silver price rallied to a two-month high, topping $24.50 an ounce. And while it has been unable to hold those gains, trading this week at $23.50, some traders remain bullish on silver.

Michael Moor, the creator of Moor Analytics, recently told Kitco News, “my gut feeling is that while silver has a solid base, it remains in major consolidation before it runs up to create a whole new phase to the upside.”

Which Silver Stocks Are Looking Good?

Silver is regularly undervalued compared to other precious metals, and 2021 was no different – which leaves room for explosive growth in 2022.

One company in a prime position to benefit from rising silver price is Golden Tag Resources Ltd. (TSXV:GOG).

Golden Tag is a junior mineral exploration company with significant assets in resource-rich Durango, Mexico. The company holds 100% interest, subject to a 2% NSR, in a San Diego property located within the prolific Velardeña Mining District. Over the past century, the site has yielded silver, zinc, lead, and gold.

The project currently hosts indicated and inferred mineral resources of over 230 Moz AgEq, and the company believes between 20 to 50 million tonnes of additional grading 100 to 150 g/t AgEq (65 to 240 million ounces) could be present.

Investment Highlights:

  • Golden Tag’s San Diego property is located within the prolific Velardeña Mining District in Durango State, Mexico.
  • Among the largest undeveloped silver deposits in Mexico with over 115 million ounces of silver, 1.5 billion pounds of zinc in resources.
  • One of the most undervalued assets in the market on an EV/oz basis
  • New management on board at the helm.
  • Several exploration targets ready to be tested could expand the deposit materially in several key areas.
  • Well financed with approximately $9 million in cash balance.
  • Exploration program underway with exciting news flowing throughout 2021

What did GOG do in 2021?

In May 2021, drilling at the San Diego property intersected 892.25 g/t AgEq over 10 metres and led to the discovery of a new near-surface epithermal mineralization zone. Commenting on the find, Greg McKenzie, President and CEO, said:

“We were pleasantly surprised to have discovered this new mineralization, located at the top of hole 21-57 approximately 500 m above the planned target area. This is a significant discovery because it opens up the potential for epithermal type mineralization on the San Diego Project, above and beyond the broad skarn mineralization typically encountered. Our next phase of drilling will attempt to follow up and expand upon this discovery.”

In August, in partnership with Orix Geoscience, GOG completed a Geological Interpretation Program. The primary objective of the review was to help better define the geological conditions at the company’s San Diego Project. Using 3D generated modelling, the study ultimately concluded broad zones of skarn mineralization open to the north, northwest, and southeast of the currently modelled Fernandez Zone, creating numerous potential drilling targets.

In October, the company expanded drilling operations at the San Diego property to include an additional 4,500 metres. The expanded program comes on the heels of 4,716 metres of drilling previously completed and reported in 2021.

Most recently, the company released more exciting results from diamond drill hole 21-60A, part of an exploration program targeting bulk-tonnage mineralization at the San Diego Project. Key highlights included the discovery of 272 g/t AgEq over 7.8 m, within a broader interval of 120 g/t AgEq over 35.7 m, within the Montanez Zone and 100 g/t AgEq over 322.9 m, including a higher-grade interval of 142 g/t AgEq over 91.6 m, within the Fernandez Zone.

Disclaimer: The company described in this article is a customer of NAI Interactive Ltd. This material is for informational purposes only and is not intended as a recommendation or offer or solicitation for the purchase or sale of any securities or financial instruments, or for transactions involving any financial instrument or trading strategy.


Investment Mining Precious Metals Silver