Predictive Discovery Share Price up after Trading Halt

Predictive Discovery Share Price up after Trading Halt

The share price of Predictive Discovery Ltd [ASX:PDI] has opened strongly today upon its emergence from a trading halt pending its latest drilling results.

PDI shares entered a trading halt on Wednesday to allow it time to interpret results from its latest batch of diamond drill holes.

Apparently, it was worth the wait.

The PDI share price is up 1.5 cents or 20.27% at time of writing to trade at 8.9 cents per share.

ASX PDI Share Price Cart - Predictive Discovery

Source: Tradingview

Share price shaky but results seem strong

We last visited the PDI share price two weeks ago to the day.

At that time PDI share were in a bit of a slump.

Today, they are up over 20%.

Both sets of results are from drilling at the Bankan gold discovery at PDI’s Kaninko Gold Project, located in Guinea.

Interestingly, at first glance the results don’t seem too dissimilar.

But there are certain distinct differences, which I will cover shortly.

But first I wanted to look at the share price.

Notice the crossover ‘sell’ signal back when we last visited PDI.

Though the 10-day moving average hasn’t crossed above the 30-day moving average yet, its looking like it could.

What was the market wanting to see before the share price could begin to track upwards again?

I’ll cover one possibility now.

It’s about continuity (and size)

I suggest you have a read of the last PDI results we covered, it’ll help clarify the point I make here.

Firstly, a disclaimer:

The immediate difference between the results two weeks ago and today is the type of drilling method used — ignoring the quantitative differences of gold grade.

If you’re already lost, bear with me it will all make sense in a minute.

Today’s drilling highlights include:

  • 153m at 1.51 grams of gold per tonne (g/t) from 47m, including 6m at 10.40g/t from 189m
  • 78m at 2.58g/t from 3m, including 4m at 13.64g/t
  • 2m at 1.51g/t from 1.8m, including 2m at 7.65g/t

You’ll notice three things about these results compared to the last.

The first: the grades seem quite similar ranging from average to high.

The second: the continuity (meaning the length of the gold mineralisation) is also similar.

That is there appears to be high continuity — a good thing.

The third: these results are resulted much deeper below the surface.

And that’s the kicker for the share price action today.

Take a look at the two figures below.

ASX PDI - Kaninko Project Section

Source: Predictive Discovery

Predictive Discovery Cross Section

Source: Predictive Discovery

These are the same cross sections at Bankan.

The top approximates the resource after drilling results today.

The bottom if from two weeks ago.

Diamond core drilling (used today) allows the explorer to drill much deeper below the surface.

Because reverse circulation (RC) drilling (used previously) isn’t as good at sampling layers of rock, it was difficult to analyse what the resource might look like.

Today we get a better picture.

And investors seemed pleased with the results.

PDI Managing Director Paul Roberts shares a similar sentiment:

Drill holes to date have largely been orientated from east to west (270-degree azimuth), however these results and the recently released initial RC results1 suggest that the overall mineralised envelope may dip steeply to the west.

While the AC and RC drilling may not have been optimally orientated to test that dip, it has successfully defined the width of the gold-mineralised system…

Samples from a further 31 RC are awaiting analysis.

And both diamond core and RC drilling is ongoing at Bankan.

We’ll be sure to keep you updated with developments from some of Australia’s most interesting gold explorers and miners. In the meantime, make sure you subscribe to The Daily Reckoning Australia. It’s a great way to stay ahead of the curve when it comes to Australian gold stocks. It’s free too. Subscribe here.


Kind Regards, 

Lachlann Tierney,

For The Daily Reckoning Australia