Detour Gold (DGC.TO)

(Market Call Minute.) Short term he thinks they are still in ramp up, but long term he thinks it is a marquee asset.

This is the seasonal strength for gold, and looks lined up for a seasonal move. The 15 and 20 day are pointing higher, which implies a short and intermediate trend which is a good setup for the seasonal trade ahead.

Chart shows the trend is on the upside. Outperforming the market, and above its 20 day moving average. Seasonality for gold is just turning positive right now. Should be positive right through until the end of September.

There was some cycling of capital from Osisko, with its Quebec Malartic mine into this company with its Ontario mine. Thinks they will both ultimately be 600,000 ounce a day producers. This is a single asset project, so you begin to wonder about the next step. At least with Osisko, they put together other projects that could work at higher gold prices. This company has nothing but exploration around where they are. He owns it, just because he likes the re-rating as it continues to show better throughput and better grades and growth of production into 2015-2016.

Gold looks like it has put a bottom in a few weeks ago. Some of the lead stocks are turning. Think you will get a premium on this one. He is playing the big guys because they will turn first, and deliver first. Thinks there is a trading rally starting now.

New mine in northern Ontario is producing around 500,000 ounces a year. Costs are slightly above the gold price, but over the long run it should come down. Missed a little financially on sales in Q1, but he doesn’t just look at sales. Looks at tons produced, grades and ultimately recoveries. Using metrics that he uses on mines starting up, this one looks better than he expected. Sees fundamental value north of $20. Thinks this is in the crosshairs of a lot of major companies.

Gold did well at the beginning of the year. But it is really just under a resistance level of $12.25, unless there is a strong move in gold. Wait until July.

Had been cautious on this for a long time because he thought they needed money. His thinking changed after the takeout offer of Osisko (OSK-T). The big guys are looking at assets and there are not many of them around. Have the ability to raise money in a difficult environment.

His base case is that gold 18 months ago rolled over, probably for the cycle. While we will have tactical rallies, they are likely to underperform for some time. Can’t see many significant catalysts for gold right now.

Thinks they have a great mine and a great asset and the valuation is certainly fair, but there are going to be some hiccups in the next year. When you see a pullback, it is a world-class asset and you should be adding to it. Also, when you see it taking off with valuations getting ridiculous, recognize that they may trip up and fall so you might want to take some profits here and there.

Likes the gold stocks and the Junior sector. If you are going to get involved with this sector, buy 2 or 3 names, not just one. Chart shows a bottom in the latter part of 2013 and it is now trying to get above $12.20. An investigation has been launched on behalf of shareholders. If you own, he would probably stay with it, but instead of adding to it, find another name in order to diversify a bit.

Quality company but the problem is the sector. We made a double bottom pattern in gold. Thinks there is one more shaking out in the gold sector to come, plus you need inflation for gold to take off. This one would be a great way to play it then.

The gold sector looks strong, outperforming the market and above its 20 day moving average. This stock shows a base building pattern and has established an upward trend. There is minor resistance at around $12.20 but he wouldn’t be too concerned about that. This has a technical score of 3. Gold stocks tend to take a bit of a rest between now and July each year.

It is pretty fully priced. It will be a market leader because it hits all the right buttons.

Best performing gold stock in Canada recently. He is not a big fan. It is a big, low grade project, although in a safe jurisdiction. Prefers B2Gold Corporation.