SELECT SANDS CORP...

originally published Sunday, August 14, 2016

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All Base Metal & Mineral Stocks

Select Sands two big things going for it. One is that it is a high quality industrial sand producer, of the kind used in oil and gas drilling and various other applications, whose main production is in Arkansas, close to its markets, giving it an important competitive advantage. The other is that although it appears to have turned over important gold properties to Comstock Metals, it has does so in exchange for a sizeable equity position in Comstock, and so in effect will also benefit from the expected big rise in the gold price over the next several years.

On the 6-month chart we can see that the market rejoiced last week at the news of the definitive agreement between the company and Comstock Metals, with the stock surging for several days and vaulting above a line of resistance at about C$0.31 - C$0.32. Although it is now starting to look overbought, this move may continue to the high C$0.40’s where more serious resistance will be encountered, which is visible on longer-term charts.


The long-term 9-year chart for Select Sands is actually most encouraging, as it shows that a large base pattern has formed, that is probably best described as a Triple Bottom, which goes back to when the stock hit bottom in 2010 and in fact the basing process began as far back as 2008, even though the final low came later. Of great importance on this chart are the volume indicators which have both been climbing steadily and provide firm evidence that a base pattern is indeed forming – and why not? - since Select Sands is set to benefit significantly not just from its competitive advantage in the industrial sand business but also from its sizeable interest in a rising gold price.


Conclusion: Select Sands looks like a good investment here, particularly for the medium to long-term. Although it is rather overbought short-term, it is unlikely to react back much, if at all, and instead is thought more likely to advance to the high C$0.40’s soon and consolidate there before breaking out of the large base pattern to embark on a major bullmarket. The company’s stock trades in light volumes on the US OTC market, which should improve as its expected bullmarket unfolds. Select Sands has an acceptable 55 million shares in issue (51.6 million float).

Select Sands website

Select Sands Corp SNS.V, CLICF on OTC, closed at C$0.37, $0.2836 on 12th August 16.


Posted at 12.55 pm on 14th August 16.

The above represents the opinion and analysis of Mr Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment or securities advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market technical analyst, Clive Maund is not a Registered Investment Advisor or Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks cannot be construed as a recommendation or solicitation to buy and sell securities.