Fission 3.0 - A Big Shakeout After More Positive Drilling Results
Fission 3.0 (TSXV:FUU) put out some more positive news this morning showing that additional step-out drilling intersected more high-grade radioactivity at its Patterson Lake North (“PLN”) project. The company drilled three additional holes, two of which intersected high-grade radioactivity - the other did not detect any anomalous radioactivity > 300 CPS. These holes round out the PLN fall drill program with drilling scheduled to restart in early January.
Given the positive news, I was quite surprised to see the stock sell-off so quickly this morning. It seems that prior to this news release, there were unrealistic expectations for these follow up holes, as the stock fell about 15% in the early hours of trading, despite the positive news. It could be that the market is focusing in on the hole which did not intersect and discounting the two holes which did. The bottom line is that the company hit more high-grade radioactivity with the drills which is very positive.
It is still very early on in the junior exploration life cycle for FUU, and these drill results are still preliminary in the sense that we have not had any actual assays back - so it is tough to jump to any real conclusions yet. However, looking at the CPS readings of the holes that did intersect, we can see some of the readings were off the charts (63,400 over 0.5m, 48,700 over 0.5m, 47,000 over 0.5m). Although these are just CPS readings and not actual assay results, these readings are pointing to VERY HIGH-GRADE uranium in the core.
Another very likely scenario here is that there is shakeout happening on the stock. I say ‘likely’ as there was a Flow-Through financing announced at $0.42 so there is a lot of big money with keen eyes on the stock.
If you are unfamiliar with the term, a “shakeout” occurs when “market professionals” are wanting to accumulate a large position in a stock that is trending strongly; either for their own account or for a major client.
How do they do this?
If they start placing buy orders in the pool, they will chase the stock up sky high, without being able to build a big enough line. The golden rule is: buy into weakness.
So, the professional bides their time, waiting for the stock to consolidate or start a short-term correction. They know that trading will be quiet during this phase: buyers lose interest for a while and look elsewhere. They also know where most traders have stops.
A few well-placed sell orders on a quiet day will drive the stock below its' support level. Stops are triggered, sending a flood of sell orders into the market. Everyone takes fright while our market professional steps forward and scoops the pool; buying in the face of the correction. Selling dries up when the stops are filled and the stock soon recovers back into its normal trading range. Everything returns to normal; except that our market professional now has a sizeable parcel of stock, accumulated at bargain-basement prices; and a group of punters curse their luck while the stock soars into the stratosphere.
I have seen this happen way too often in the junior mining sector. Retail gets spooked and sells too early, while the big money gets to add to their position at a lower cost.
Don’t fall for this trap.
Strathmore Plus Increases Night Owl Land Package by 300%
In my last article on Strathmore Plus, I highlighted something that I picked up on in their last few news releases, which was that they had been stealthily increasing the size of their land package at the Night Owl project. This may not seem very exciting, that is, unless you are reading between the lines.
In junior exploration, when you know you are on to something big, the first step is to scoop up as much land as possible in the area before the market finds out, which is exactly what Strathmore Plus has been doing.
This morning, the company put out a news release announcing that they have increased the land package at Night Owl once again, by staking an additional 54 claims.
Remember that a previous survey of the Night Owl property showed scintillometer readings of 9,999+ CPS at surface. These readings are very significant, so it makes sense that they are trying to add as much land as possible before the real exploration begins.
Mr. Terrence Osier, PG, Vice President of Exploration for Strathmore commented, "We acquired the additional adjacent claims because they cover the same geologic formations and results of the geophysical survey indicate many additional and impressive areas of radiometric anomalies similar to the Night Owl mine site."
It also important to keep in mind that Night Owl was actually a past producing uranium mine in the late 1950s to early 1960s. Night Owl was formerly mined by Night Owl Properties & Battle Axe Mining Co. producing 93 tons at a grade of 0.24% U3O8.
Although the grade was relatively low, things were a lot different back in the 50’s and 60s. Meaning, they did not have the proper technology to fully explore the land at depth. So, Night Owl area has not even been properly explored using modern exploration techniques.
With these recent additions to the land package, the company clearly believes that they are onto something big here.
The market cap of Strathmore Plus is sitting around $10M and has only ~30M shares outstanding, so it is still VERY TIGHT. Just last week, the company also announced that they had received over $1.35M from warrant exercises, so the warrant overhang on the stock is pretty much gone.
I will be keeping a very close watch on future drilling at Night Owl because if the drills are successful, the stock will likely move very quickly to the upside.
-SmallCapInvestor
DISCLOSURE
The publisher of this report was paid a fee of CAD $10,000 by Strathmore Plus Uranium for the publication of this and other reports regarding the Issuer for a period beginning on or about December 1st, 2022 and set to end on or about March 1st, 2023. From time to time,the author of this report, the publisher, and the publisher’s directors, officers, and other insiders may purchase or sell securities of the Issuer.