Recent developments at Mexivada Mining Corp. (MNV.V)

NEWS: Recent developments at Mexivada Mining Corp. (MNV.V)

By Dirk Masuch Oesterreich

Mexivada Mining. Corp. (MNV.V, MXVDF) was having a lot of action in its share price during the last two months. It went from an intraday low of less than 50 cents to an all-time high at 1.20 CDN and back to 0.70 CDN. It is today at 0.78. What’s behind all this?

Mexivada adopted a shareholder rights plan on November 6^th, which did not occur in response to a proposal to acquire control of the company. There was, however, at that time a note by Eric Hommelberg of www.golddrivers.com that seemingly raised investor awareness. Cannacord and TD Securities acted as buyers at these levels, giving a great sign of confidence in the company.

On November 8^th Mexivada reported that it has discovered a previously unknown porphyry molybdenum-rhenium-gold-silver system at its Moly Dome property in the Owyhee desert in the very first drillhole of phase 1 drilling on the property. They staked 70 new claims around the property to protect the target areas.

What follows is the detailed geological description taken from the press release at their website:

Molybdenite-pyrite veined quartz stockwork breccia was intersected in brecciated metasedimentary rocks, just below the thin soil cover, down to a depth of 515 feet (157 metres, "m"). Local pyrrhotite is present in these rocks. A silled granitic porphyry intrusive was intersected between 157 and 168 m, which contains local molybdenite. Metasedimentary rocks continue downhole to a depth of 204 m, and these rocks also contain varying amounts of quartz-molybdenite-pyrite stockwork mineralization. A retrograded quartz-sericite-pyrite ("QSP") altered granitic porphyry intrusive with quartz-molybdenite veining was intersected down to a depth of 216.5 m, where a 6.7 m wide quartz-chalcopyrite-molybdenite vein was intersected. Retrograded QSP altered granitic intrusive rocks with molybdenite-quartz stringers persisted down to 258 m, where a 3 m wide fault zone was encountered, perhaps at the contact with a large intrusive body. Hydrothermally altered granitic intrusive rocks with spottier, local quartz-molybdenite-pyrite veining were intersected between 259 m and 323 m, the bottom of the hole as of November 7th. Drilling continues, with an expected completion depth at 457 m.

COMMENT: Note that these are very preliminary results. Cores still have to be analyzed to know what they really found.

Mexivada’s stock price spiked on the news at 1.20 CDN and then fell off a cliff to 0.70 in the next days. What happened? MNV has almost 2 million warrants expiring at 0.75 CDN per share and another 350k warrants expiring at 0.50 CDN per share until Wednesday this week, november 28^th. I guess a lot of the recent selling was done by early investors who took the opportunity to lock in profits.

Technically, MNV now sits at its 200 dma support and seems to be in oversold territory. Before you decide to jump in on the stock consider this: The 2-year chart shows a clearly established uptrend. It also shows some rather wild swings around the 200 dma trendline. MNV has something for every taste. As an investor with a longer term outlook you will like the established uptrend. However, be prepared to have your resolve gut checked on the way up. And as a gunslinging speculator it is just those wild swings that you will love for providing you with entry and exit points. Whatever you do, be careful with this stock. Mexivada is not for the faint of heart.

On a more personal note, I had the chance to sit down with Rick Redfern, Mexivada’s CEO and President, in the bar of Elko’s Comfort Inn during the GSN fall field trip. Rick just flew in that night from Colorado. I found him to be a very straight forward, results oriented guy who surely knows his way around Nevada and Mexico. Being in quite a talkative mood he was also excellent company to spend time with.

Mexivada was mentioned on this blog for the first time in May this year. If you got in then you would have been sitting on more than a double during the recent action.

(Map generated from my database of stock exchange listed Nevada mining companies, see here.)

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