Cygnus Gold Intersects High-Grade Gold At Kepler; Downtrend Momentum Abating

Cygnus Gold Intersects High-Grade Gold At Kepler; Downtrend Momentum Abating

Cygnus Gold Limited (ASX: CY5) is an ASX listed mining company which is focusing on base metals and gold deposits, situated in Southwest Terrane, Wheatbelt region of Western Australia. Southwest Terrane consists of well mineralised high metamorphic grade rocks forming part of Yilgarn Craton. The company also has a joint venture with Gold Road Resources Limited (ASX : GOR) for the exploration of Yandina Project.

Kepler Zone

On 28th May 2019, the company announced the intersection of high-grade gold at 220m along strike from previous high-grade results at Kepler Zone. The Kepler Zone was identified after reviewing the drilling surrounding the high-grade bottleneck prospect, which ended in returning 5m @ 1.8 gram per tonne gold from 137m to the end of the hole which included 1m @ 6.29 gram per tonne gold from 139m.

A large extent of the metadacite unit is still untested, the company will compete a structural interpretation to guide further drilling of this zone.

Stanley Drilling Program

On a 20+ km long Stanley greenstone belt, the company has received results from reverse circulation (RC) drilling programs from McDougalls and Kepler prospects.

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McDougalls

The McDougalls prospect is situated 5km southeast of the Kepler Zone. The company’s previously reported RC holes which intersected anomalous gold were

  • Drill hole identified as STRC0007 intersected 4m @ 0.25 gram per tonne gold from 32m
  • Drill hole identified as STRC0008 intersected 16m @ 0.19 gram per tonne gold from 32m
  • Drill hole identified as STRC0016 intersected 10m @ 0.37 gram per tonne gold from 50m

On the same day, the company also announced the results of its annual general meeting (AGM) wherein all five resolutions were passed with majority votes.

On 8th May 2019, the company confirmed Nickel potential from Bencubbin North.

On 17th April 2019, the company reported its progress over Gruyere gold project.

Technical Outlook

The stock is a relatively new listing on ASX and got listed in January 2018. The stock listed at a price of A$0.30 and within a few weeks the price touched the all-time high of A$0.375. This was the last sunrise for the stock, after which it started to fall. In the next few weeks, the selling got intensified, and the stock picked momentum on the downside.

But this was just the mid-way of the complete fall that was waiting to unfold. Gradually the stock price kept on declining and made a low all the way down to A$0.042. At this point, the stock had dropped more than 80% from the listing price.

Weekly Price chart of Cygnus Gold (Source: Thomson Reuters)

Around the lows of A$0.042 – A$0.045, the stock seems to be stabilising and the falling trend is clearly losing its momentum (depicted by angle of the white lines) as the stock has started to move more in a sideways trend.

Currently, the stock is trading around A$0.050, and as long as the support zone of A$0.042 – A$0.045 holds, a reversal from here would not be a surprise.

Stock Performance

The company has a market capitalisation of A$3.03 million, and the stock had touched a 52-week high and low of A$0.2 and A$0.042 respectively. The stock had closed, flat at A$0.05, as on 28th May 2019. The last one-year return of the stock is negative 72.9%, and the YTD return stands at negative 23%.


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