And now… the jump to light speed?
We FDR shareholders are facing the happy dilemma of guessing what made our stock break out decisively from its recent range this week. So many possible answers.
A leak of high-grade bonanza intervals? Mere anticipation of the next results… even if they are just more “expected, acceptably-solid” grades? The thought that the second drill rig might even now be turning, and has already visited a few widespread targets - finding multiple visible gold flecks in the resulting cores?
An enthusiastic new investor with deep pockets and little fear of losses? Perhaps an institution, the first of several who have come to terms with never gaining easy entry through a financing and is thus settling for the consolation prize of being first-mover in grabbing shares on the open market? Or maybe some other sophisticated players who only incidentally concern themselves with the FDR story but who know a fantastically leveraged and long-lived call option on fast rising gold prices when they see it?
Short covering, causing other (already bullish) investors to join in the resulting feeding frenzy?
All of the above? Or just growing recognition for the all-around beauty of FDR’s construction and current situation?
In any case, we are surely approaching what may be a rare example of a sellers’ strike, or at least something close to it. Where exactly are new offers to come from? Sure, day traders will always exist, but they first need to buy, and may thus end up being a net positive to the share price due to their impatient nature. If big insiders are, quite understandably, taking some modest profits at this juncture, we’ll know soon enough through their filings. And given an FDR market currently screaming for shares, their extra supply contribution may be exactly what is needed to keep optimally feeding this breakout. New investors do like a fast-moving stock, but they also prefer a liquid stock.
Whenever the next results arrive, it won’t really matter how little stock is available for sale, as the market will quickly find a new level, even if on modest volume. If we reach a tipping point where nearly everyone has decided to Hold On for Dear Life, or at least for a buy-out, it simply means FDR will find a new near-term equilibrium higher than otherwise. But a vanishingly small number of shares ordinarily available for sale, if that is what we are facing, may shorten the ultimate time to the takeover offer(s). Although we’ve still got a ways to go in terms of proving up the property, including a new financing or two to strengthen our cash position in this uncertain world, things are looking pretty bright this weekend.
And to those of you who’ve yet to take a position, do you believe FDR’s potential now?