The junior resource market has recently seen easy profits, as the riding tide lifted all boats; now, however, the market is becoming more of a stock pickers game, suggests Brien Lundin, editor of The Gold Newsletter.

With that said, there are some very interesting opportunities right now. One of these is a long-time favorite of ours, Cayden Resources (SCT:CYD).

We consider this a smart money play, led by a very competent and proven management team, with backers who have been very reluctant to sell.

It’s up about 85% so far the year, and those investors looking for a bargain-priced play would probably not give this stock a second glance. But someone’s been buying Cayden (including the participants in a recent C$7.8 million bought-deal financing).

I think the drill results on the company’s El Barqueno gold project show why. Hampered a bit by delays in getting drill permits, management has been compensating by drilling very aggressively in the areas on the El Barqueno property where they have permits.

The property is huge—over 46,000 hectares, or 464 square kilometers—and replete with vein swarms characterized by mineralized surround rock. So far, the company has been able to explore only about 60% of the property, but hand trenching has outlined nine advanced targets.

Of these, only one has yet been drilled, with permits in hand allowing for at least three more to be drilled this year. The company plans to drill an impressive 35,000 meters this year, so news will flow in fast and furious fashion.

To make a long story shorter, the results are starting to add up. And, importantly, they are combining with geophysical surveys and trench results to open up the possibility of two intersecting trends.

Each of these trends, if confirmed by the drill bit, would extend over five kilometers in strike. Thus, even with just one zone being drilled so far, the potential for a multi-million-ounce deposit can be seen. And I believe this is why money is coming into this stock.

While the stock may not be on the bargain block, it does offer the potential of an emerging, well-funded drill play that has shown a reluctance to fall in value. In my view, the stock appears to be heading higher. It’s a strong buy.

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