Are You Watching Silvercorp?

Why should you be watching Silvercorp? Well today it was up another almost 15%!

Like I've been saying all along, this is the best Silver stock out there right now. It has a very good mix of risk/reward.

Because its market cap crossed 500 million today, it's not that small anymore where it can be fully manipulated and it could go bankrupt in one day.

It's getting to be something with a really good chance of making it big.

Let me just post up a picture of its near perfect chart to remind you how much we've gone up recently:



The thing that is so great when I look at this chart is that the ride has been so smooth on the way up.

Some stocks are so volatile that you can't sleep at night because of their huge price moves up and down.

Silvercorp has been very steady on its way up. I just love it. It's one of these stocks that if you only look at it once a month, it'll always be higher the next time you check it out.

So for today's price movement, it had a lot to do with the news release. To me, it was nothing new. It was mostly all the things I told in the previous IR notes special report. Although this news release shows all the exact numbers and predictions...

The two most important things in this release are not all the numbers but these two statments:

"Work is carried out through Silvercorp's 77.5% subsidiary Henan Found Mining Co. Ltd. The 2006 budget, which runs from January 31, to December 31, 2006, is anticipated to be financed entirely by cash flow generated from production.

In other words, they won't need to dilute the float of take on any new financing. It will all be paid for by cashflow. This is brilliant but you need very smart managing and a very high quality project to be able to do this. Silvercorp has both in my opinion.

The second point is:

"The 2005 program was generally completed on time, or ahead of schedule. Based on the extensive exploration and development work completed in 2005, SRK Consulting has been retained to complete a review of Resources, which should be completed by the end of April 2006 and is expected to substantially increase the last Resource estimate released in April 2005."

I put a lot of focus on past results and the fact that they did everything right and on time in 2005 leads me to be quite confident that everything done in 2006 will be done in the same manner;on time, or ahead of schedule. But even more positive is the fact that in April, we have a very good chance of seeing higher resource estimates. This could do nothing but push our stock price higher.

So can you get the feeling that I'm really bullish on this stock yet? I hope I'm not making it too obvious...

This will be one of the great stories of 2006 and it would be great if you could be a part of it. I am and many others are to, are you?

P.S. If you look at the W%R indicator in the chart here, you can see that Silvercorp is too overbought. That means that we've had a great run over the past little while and there is a good chance that we need to take a little breather. If this happens, I will try to pick up some more shares. However, I thought that this week would be that breather but I was wrong. The fundamentals for Silver and Silvercorp are so strong that it's very difficult to predict down days/weeks because there are so few of them compared to all the up days! I suggest you buy Silvercorp over many days/weeks and cost average your shares...or just buy all you can right away, tuck them in the back of your rrsp and send me a thank-you cheque next year when you've made mad money!