chart alert

Those familiar with spec. gold stock Golden State Resources will know that the SP moved to within striking distance of the critical breakout point of .052 cents.

Speculation as to the reasons behind the recent activity has focused on:

1) pleasing gold assay results recently announced at Leonora

2) the company's pursuit of suitable JV partners to speed progress towards production

3) the attractive look of the chart itself: 3 years of trawling the lows appears to have seen off the bears

4) the buoyant gold price and spreading gold fever

GDN closed up 11% yesterday on its day high on a huge increase in volume. Normally that would indicate a surge onwards from here (especially given the all-time highs of 52 cents this stock reached in 2000).

Any opinions out there as to what comes next? Will it retrace slightly before breakout above the critical .052 resistance level? Will it mark time pending an announcement? Will the recent flurry of activity dwindle away as it has done before?

With regard to Astronaut's interesting observation that the 2000 high might have been driven by a dot.com style announcement by GDN at that time, I posted the following late last evening:

'No doubt there was an element of dot.com gloss rubbing off on GDN at that time. However the fact that the share price had well and truly bolted at least a month before the announcement you refer to suggests a certain internal momentum (on Jan. 7, 2000 the ASX queried the rise from .095 cents to .15 cents)

The company's response to the ASX query focused on increased media coverage of its nickel and other assets in a buoyant market - interestingly, very similar conditions to those which prevail in our current climate.

Therefore, while the dot.com announcement undoubtedly provided extra stimulus to the share price (given the flavour of those times) I don't think it was the main instigator in its leap into the stratosphere.

With regard to the 10-bagger potential of the stock, I only reported a respected chart analyst's view that the precedent is there. Of course that by no means guarantees it will do it again but we live in hope.....'

I suspect we are in for an interesting next few weeks. I hold. Conduct your own research.

Good luck to all,

Gupper