FDR and the Unseen ForceYou bet I’ve got a comment, Seahawk. But not exactly the one I was expecting to be writing.
FDR delivered some excellent assays geographically positioned to continue supporting the theme of an ever-growing high-grade deposit. All good so far. And… where were the heavy buyers I was expecting to jump in with both feet? Did they somehow take a wrong turn on the back roads and miss the party at the open this morning?
I’ll get to that in a moment. First, a brief comment on Padget’s metallic screening remarks. Seems almost counter-intuitive to a non-geo like me. I would have thought coarser gold granules would have been easier to detect, not harder. But that’s barely a problem.
Or at least it’s a problem containing another fantastic opportunity for positive press. Because it sounds like our leader is hinting that the more thorough lab analysis might actually bump up that 400+ gram meter hit. To 600? 800? What’s not to like?
And the timing may be perfect if we get that additional lab work back on, say April 2nd or 3rd. Can anyone guess where I’m going with this?
Recall our humble beginnings last July. FDR’s very first drill results were expected any time in the second half of the month. But they didn’t arrive before the trading hold came off the March 2023 PP. And the stock fell roughly 25% on heavy volume.
Ouch. I had been wondering as the hold expiry approached whether it might make sense to wait for a better entry price for the balance of my initial position when the wave of potential selling was to hit the market. Being the impatient type, and with an overactive imagination, I decided not to wait. And my punishment was not maximizing my FDR holdings. I could have had 33% more shares for my second tranche.
Not a huge mistake? And no one trades perfectly anyhow? Maybe so. But playing the odds is how most great trading fortunes are made in this sector. And perhaps the lesson here is more subtle. When they finally arrived, FDR’s initial, end of July drill results were enough to start the stock moving up – doubling prices from the dip low within a couple of weeks.
So here we stand today, all of us expecting great things from our team. Yet perhaps ignoring the massive but perhaps unseen gravitational pull of the impending free-trading date from our November financing. Yes, as Coffin has reminded us, most of those participants are not the type to flip their shares out for a quick profit. But it doesn’t take a lot.
If even 25% of those escrowed shares hit the market, whether for pure profit or just to recover capital, that’s nearly 1.8 million shares. And the rich players out there didn’t get rich by failing to regularly recover their capital. Once speculating becomes just a game to them, even a great story like Founders won’t compel most of them to stay all-in.
There may be institutions waiting to gobble up all those shares with neat block trades… but don’t count on it. It might have to come from retail. Back in July, the selling amounted to about $300,000 worth of stock. Today, there could be 9x that much dollar value to absorb. Or more. That’s a lot of retail buying. At least a couple dozen new “all-in” personalities would be needed.
Sure, our news today was twice the gram-meters level of our assays last July, and it has arrived *before* the free-trading date. But I suspect professional traders know well what amateurs like me often forget. Namely, that a sure thing (the certain arrival of some large amount of selling) beats dreams (of longs who aren’t still looking to add aggressively) every time. Or nearly every time.
On the other hand, look at the good side of this analysis. If the same July 2023 chart proportions hold, FDR's share price may be about to commence a serious assault on $3.00. Ostensibly to arrive at that magical marginable share price inflection point level within three weeks. Helped along by those re-assayed results from that spectacular visible vein core, no doubt.
And once that placement selling dries up, there really is no hope for buying in size except to pay in full whatever the offers demand. Happy times for us established longs.