Expert Sees Major Bull Market Starting For This Gold Co.
Contributed Opinion

1. Western Exploration Inc. is a billboard sponsor of Streetwise Reports and pays SWR a monthly sponsorship fee between US$4,000 and US$5,000. 
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Although Western Exploration Inc. (WEX:TSX.V; WEXPF:OTC) is still at about the same price as where we looked at it last April, its technical condition is vastly improved as we will proceed to see after again reviewing the fundamentals of the company.

Western Exploration is chiefly a gold explorer, and gold is set to perform very well over the next several years due to accelerating currency debasement and war, with silver set to do very well too, especially later in the cycle, and these trends will clearly be beneficial for the company. Another big positive is that the company has already discovered significant reserves at its projects in northern Nevada, which is a mining-friendly jurisdiction and still another positive is that the number of shares available to retail investors is tiny at about 6% of the number of shares in issue which itself is a reasonable 43.8 million. This means that any significant increase in demand for the stock could lead to a spectacular spike, and the stock is already powering up to make significant gains.

The following slide, taken from the company's latest investor deck, shows the key investment highlights of the company.

The company's flagship property in northern Nevada has two main ore bearing areas, Doby George and Gravel Creek.

The next slide displays the MRE (mineral resource estimate) for the Aura Project.

The last slide shows the capital structure of the company, and it shows that due to Golkonda owning a sizable 46% stake in the company, Agnico Eagle Mines Ltd. (AEM:TSX; AEM:NYSE) owning a further 14%, other institutions owning 18%, high net worth investors owning 7% and directors and management owning 3%, that only leaves a meager 6% of shares in the float for retail investors to buy.

So it is clear that once interest in this sector ramps up, which it appears to be now, the scope for speculative gains in a stock such as this is great.

Turning now to the charts, we quickly realize that Western Exploration is powering up for a major bull market. We had earlier observed the breakout from a Head-and-Shoulders bottom in March that is shown on the 20-month chart below, and whilst we had expected a normal post-breakout reaction, it was not expected to react back as far as it did, for as we can see, it reacted back into the H&S bottom and although this was a somewhat disquieting development, the buoyancy of the Accumulation line when this happened suggested that it would reverse back to the upside and that it has done.

A Double Bottom base pattern formed above CA$0.70, and the good news is that it broke out of this Double Bottom on really strong upside volume, which is clearly bullish, and we will now proceed to look at this in more detail on the 6-month chart.

On the 6-month chart we see how the price broke out of the second low of the Double Bottom on really strong volume late last month a move that was followed by consolidation in a small Flag leading to renewed advance with very positive price / volume action with the Accumulation line strong and momentum (MACD) improving.

The price / volume has been positive for most of this year, and the price is now starting to advance away from the base that started to form as far back as August of last year, and at a time when the entire sector is commencing a major bull market.

Holders of Western Exploration should, therefore, stay long, and it is rated a Strong Buy here as the bull market is still in its earliest stages.

Western Exploration's website.

Western Exploration Inc. (WEX:TSX.V; WEXPF:OTC) closed at CA$1.11, US$0.803 on August 20, 2024.