March 16th, 2021 | 09:40 CET
Alibaba, Desert Gold Ventures, First Majestic Silver - Don't miss the entry!
Table of contents:
Desert Gold Ventures - On track
The gold price high since summer at just under USD 2,070 has been followed by a consolidation phase lasting several months, which at times led below the USD 1,700 mark. The price turned around at the critical support zone of USD 1,680. Currently, a bottoming out around the USD 1,720 is taking place. Should this hold, the adjustment should be over for the time being. Gold mines have lost more than the price. They act as a lever in both directions. It's time to get your foot in the door on promising mining stocks. One interesting investment is Desert Gold Ventures.
The gold explorer with a stock market valuation of just under EUR 15 million has halved in value since the all-time high in the gold price, but fundamentally things are going more than well. A few weeks ago, the Company reported on the most extensive drilling program in its history, covering 20,000 meters at the SMSZ project in Mali. Already this year, the breakthrough should be achieved on the project, as there are several promising targets at an advanced stage in the correct regional environment. The project is located between the Fekola gold mine of B2Gold, the Gounkoto and Loulo mines of Barrick Gold and the Sadiola and Yatela mines of the consortium AngloGold Ashanti, Iamgold and the government of Mali in the immediate vicinity.
First Majestic Silver- The chart wants to go up!
We have already seen a new all-time high for First Majestic Silver this year. However, this had less fundamental reasons. In the course of the Reddit community's "WallStreetBets" silver campaign, the value exploded to the equivalent of almost EUR 22.00, only to collapse again to EUR 13.00 a short time later. The EUR 13.00 mark now served as an important support line in the past few days and was successfully defended. A break above the EUR 15.00 mark would result in a price target of EUR 17.00.
On the corporate side, there are currently quite positive reports. The Company announced the acquisition of the Jerritt Canyon mine in Nevada. The mine was paid for by Sprott Mining for USD 470 million in First Majestic shares plus 5 million First Majestic share purchase warrants. The mine has produced over 9.5 million ounces of gold in its 40-year production history. The mine is currently operated as an underground mine.
Alibaba - Uncertainty weighs!
An investment in the Chinese Internet giant Alibaba remains uncertain at the moment. After the slump last year, when the subsidiary Ant Group's IPO was briefly canceled and Company founder Jack Ma disappeared for several weeks, the price was able to hold above the EUR 200.00 mark after the crash from over EUR 270.00 to a low of EUR 170.00. Currently, the chart picture has clouded significantly due to the renewed slide to EUR 190.00. One reason for the weak performance is the Chinese government's pressure on Internet giants such as Baidu, Tencent and Alibaba. The first fines have now been imposed on the companies. Although the penalties are "only" just under USD 80,000, they are more of a warning shot. In this way, the government is forcing control over its domestic Internet companies. Monopolistic practices and potential violations of consumer rights go against the grain of the policy.
According to the Wall Street Journal, Alibaba could be in for a tough time. The competition authorities may impose new record fines of more than USD 800 million. As the WSJ reported, the authorities accuse the online group of prohibiting merchants on its platform from using other online companies. Moreover, another blow is the resignation of Ant Financial's CEO, Simon Hu. The latter handed over his key last week "for personal reasons." We would currently refrain from investing, in addition to the technical chart situation, for the reasons mentioned above.
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