Golden Tag Resources Ltd. (TSXV:GOG)
Creating a new Latin American focused silver producer through a disciplined acquisition and exploration strategy.
Toronto-based mineral resource exploration company, Golden Tag Resources Ltd. (TSX.V: GOG) has been facing months of downtrending stock prices. With recent developments with its acquisition of a new project in Mexico, will the stock make a turnaround?
Golden Tag has been seeing a downtrend on its stock price since the end of 2022, dropping from $0.24 to 0.11 in July. We noticed that there was a strong support at around $0.125 which has held since July 2022, which recently broke in late June. The stock has rebounded past that point in recent days’ trading but has again touched support this week.
In technical analysis, breaking below a significant support level is often viewed as a bearish signal. Traders may interpret this as an opportunity to short the stock or sell existing positions. Additionally, other market participants may also become cautious about buying the stock, leading to decreased demand and further downward pressure on the price.
Investors and traders often pay close attention to support levels because they can serve as potential buying opportunities. But when support is broken multiple times, it could also act as a warning sign that the stock’s price may continue to decline
Typically, in these cases, investors that are hungry for bargains are waiting for news or a change in macroeconomic sentiment to signal some form of turnaround. Will GOG’s recent press release be that spark?
GOG provided an update on its proposed acquisition of the La Parrilla Silver Mine Complex in Durango, Mexico, from First Majestic Silver Corp. The transaction is progressing as planned and is expected to close in August, pending approval from Golden Tag shareholders and all necessary regulatory approvals, including the TSXV. The acquisition received approval from Mexico’s antitrust agency, COFECE, on May 25, 2023. Golden Tag and First Majestic amended the Asset Purchase Agreement to reduce Golden Tag’s minimum required financing to $7.2 million from $9 million. The company has already closed two tranches of its non-brokered private placement financing, raising a total of $6.9 million, and has received additional subscription commitments to exceed the required financing. Golden Tag Resources holds a 100% interest in the San Diego Project, located in the prolific Velardeña Mining District in Durango, Mexico, known for its production of silver, zinc, lead, and gold for over a century.
First announced in December of 2022, GOG has said that the La Parilla acquisition is a transformative acquisition for the company and they strongly believe in the upside resource growth potential of this long-life prolific asset. The short-term objective is to commence exploration within and near mine workings in order to expand the resource base, to support our ultimate goal & vision of placing the asset back into production.
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