first gold pour., page-57

re: price weakness Key for me there is not alot of volume, but on the otherside if you had a large position I guess you would sell what you could. At times like this need to evaluate risks.

1, Political risk
- I believe overestimated Armenia ranks 27 equal with Japan re degree of economic freedom. Govt very pro mining, and nil beaurocracy evident as revealed by rapid advancement of project.
-MD Matt Wood + Director Michael Haynes each have 7million shares + and aren't selling. And in Oct 2006 acquired 2 new deposits near Lichvaz. What is a vote of confidence in Armenia and via share ownership they are effectively putting their own hard earned on the line
2, Project risk
- Matt Wood MD (young and ex Rio Tinto) has fast tracked expansion, and bulk sampling indicates 11gm ton with 97% recovery. Has put reputation on the line, indicates to me the gold is there at a good grade. And the Russian initial feasibility warranted 25km of underground development.

I believe the selling is due to Patterson clients stagging the placement (offered stock at 15-20% below market who wouldn't buy). Approx 22million shares placed, since placement approximately 6 million shares traded. If even 30% of shares placed have been placed with investors who have nil knowledge of fundamentals, and were purely stags who sold initially for a profit to commence the downtrend. Or now find themselves down with stop losses being triggered then the sell off can be explained. Regarding why the sell off is not being soaked up, I believe most believers were already loaded up, and sell off post gold pour has believers worried and hence they are holding off adding to positions.

The fundamentals are excellent and the downtrend post placement has a possible technical explanation resulting from usual market mechanics. So I will add to positions and sit tight.