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In 2011 Peter Epstein, CFA, left a $3 billion hedge fund where he was a senior natural resources analyst to help increase awareness of a number of natural resource companies in which he's invested in. PLEASE FOLLOW ME ON TWITTER: @peterepstein2 Mr. Epstein formed MockingJay, Inc., a... More
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  • Pershing Gold Gearing Up For A Big September! 0 comments
    Aug 22, 2013 10:55 PM | about stocks: PGLC, UUUU, CDE, NEM, ABX, ANV, MDW
    Pershing Gold Gearing Up For a BIG September!

    Friday, August 23, 2013 · Posted in Gold, Gold Companies · by Peter Epstein

    Pershing Gold (OTCQB:PGLC) is gearing up for a big September. There's real excitement and buzz around the Company's current drill program that commenced exactly a month ago. Hopefully, initial drill results will be available next month. In addition to drilling, Pershing is hosting a series of mine site visits in September and October. Both new and existing investors are attending, including hedge and mutual fund analysts. The first visit is next week, and I'm happy to report that I will be on that tour.

    I've spoken with a few analyst friends who are making their shortlists of natural resource companies to look at after Labor Day. Newsletter writers and junior natural resource stock proponents like Eric Sprott, Mickey Fulp, Brent Cook, John Kaiser, Jeb Handwerger, Bob Moriarty and Rick Rule are calling for a rally in September-October. This would not be inconsistent with prior years. After a, "relief" rally, the thought is that the market will be confronted by tax loss selling and a fresh look at underlying fundamentals. At that point, the rally will either fade, reverse course or continue, but between now and October I believe there will be an attempt at a big push to the upside.

    In fact, we are already seeing what might be the beginning of a rally as the Market Vectors Junior Gold Miners ETF (NYSEARCA:GDXJ) is up 45% from its June low. Prospects of a big bounce in juniors is not confined to the gold sector, a select few coal and uranium names have bounced as well. For example, leading U.S. uranium company Energy Fuels, [EFR.TO / EFRFF] is up 77% from its low. Potash juniors have NOT rebounded yet, but that's a story for another day….

    Back to Pershing Gold, the stock held in exceptionally well during the April-June collapse in precious metals, a time when even gold/silver majors were down substantially. At one point in June, 6 of the top 15 majors were down 60% or more from their respective 52-week highs. By contrast, Pershing had strong support, trading the entire time in a range of about $0.34-$0.42 per share.

    My sense is that the next several weeks will be very interesting for Pershing shareholders. Successful drill results could pave the way to a dramatic improvement in already robust mine economics. Not on is there the potential for a lot more gold and silver, but there's now widespread evidence of exploration and development cost deflation in Nevada due to industry cutbacks. Pershing is one of the few companies with the drill targets and capital to play offense.

    Site visits to Pershing's Relief Canyon mine, starting next week, could not come at a better time. Analysts are sharpening their pencils, getting ready to pitch stock ideas to their well-rested, Portfolio Managers. Believe me, I know the drill. I was a senior analyst at a $3 billion hedge fund for many years. Hedge funds slow down considerably in July, and slow down A LOT more in August.

    The faintest hint of Animal Spirits, Risk-On, etc, in September could start a huge rally. And, it wouldn't take much to get the juniors moving. Think about it, many juniors are down 50% or more and trading volume is off even more than that. A relief rally could come fast and furious. Smart investors, like readers of this article, may want to front run the fund managers coming back from the Hamptons.


    Disclosure: I am long OTCQB:PGLC, EFRFF.PK.

    Themes: gold, uranium Stocks: PGLC, UUUU, CDE, NEM, ABX, ANV, MDW
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