De Grey Mining’s Share Price is Stuck. Here’s What Will Move it…
The De Grey Mining Ltd [ASX:DEG] share price has risen strongly today on the news of yet another extension at its Hemi gold discovery.
Despite the growing scale of the gold project, the DEG share price has met some strong resistance since hitting a high in July.
At present, it has struggled to break out of the 85 cent level — a price it has flirted with since breaking the $1 mark on 1 July.
Here is the DEG share price for the last three months.
Each of the white bars indicates the last three mineral extensions at Hemi.
The share price has either hit the 85-cent mark on or a few days after the extension announcement was made.
Except for one.
At the time of writing, DEG shares are up 1.7 cents, or 2.05%, to trade at 85 cents per share.
What does De Grey need for a breakout?
When we last looked at DEG, the share price was in a similar position to what it is now.
De Grey had just announced ‘high-grade extensions’ to one of the prospects at Hemi.
Today’s results, like before, are good.
They show good grading with broad intervals close to the surface.
- 40 metres at 2.0 grams of gold per tonne (g/t) from 36 metres
- 30 metres at 1.6 grams of g/t from 101 metres
- 150 metres at 1.5 grams of g/t, including 62.0 metres at 2.2 grams of g/t from 47.0 metres
However, today’s results come from the Brolga zone, which is just south of the fabled Aquila zone.
By now, investors have a pretty decent idea of the potential at Hemi, which might explain the price resistance.
REVEALED: What’s Next for Aussie Gold Stock Prices? Learn more here.
DEG did the legwork to demonstrate the size of the mineralisation at the project.
And with the resource still growing, there could be significant upside potential.
With mineralisation still open across the various zones at Hemi, the market could have already factored in the potential future growth.
Meaning we might not see the $1 price again until the project is ready for a new JORC 2021 estimate.
Hemi not included
The reason investors might be hanging out so much for the estimate is because Hemi was not included in DEG’s last resource upgrade.
In April, DEG increased its total resource across all its holdings by 29% to 2.2Moz.
The sheer size of Hemi offers lofty potential come the next upgrade.
Though DEG has not stated when that might be.
But with the Aussie gold scene heating up, DEG is poised for a breakout. Our resident gold expert, Shae Russell, has tipped Australia to become the next ‘gold epicentre’, meaning there could be big spikes in Aussie gold stock prices. If you want to learn more, download your free report here.
The Daily Reckoning Australia