Gold plays are eyeing the climb in gold prices to a near two-week high of $US1,745 ($2,276) an ounce thanks to a weaker US dollar, falling bond yields and a rally in crude oil prices that fuelled precious metal bulls.

Despite the slowly improving sentiment surrounding gold, analysts remained cautious about its prospects, saying that it would likely remain neutral if prices did not break past the $US1,750 barrier.

Commerzbank analyst Carsten Fritsch is a little more positive, saying that some tailwinds are starting to pick up for the gold market as solid economic data fails to provide support for the US dollar and bond yields.

He added that the US dollar and bond yields are not rising as investors continue to expect the Federal Reserve to maintain its ultra-accommodative monetary policies.
 

Small cap Australian gold plays

With prices rising, here are some small cap gold plays with news out today.

Silver City Minerals (ASX:SCI) has entered into a binding agreement for what it describes as a “tranformational” acquisition of an 80 per cent stake in a high-grade gold project in Western Australia.

The Austin project, in the prolific gold mining district of the Mt Magnet and Tuckabianna Greenstone Belts, comprises a large portfolio of granted mining leases and exploration licenses covering 175sqkm adjacent to Musgrave Minerals’ (ASX:MGV) Cue gold project.

While minimal modern exploration has been carried out to date, limited shallow drilling has returned intriguing results such as 6m grading 15.8 grams per tonne gold from a depth of 36m at the Brunswick Hill prospect and 2m at 4.9g/t gold from 32m at the Brians prospect.

Several other targets have been highlighted based on widespread gold observed at surface by historical and present day prospectors.

Auteco Minerals (ASX:AUT) is expecting big things from its upcoming resource update after drilling identified more high-grade gold veins in the Shaft 3 area of the Pickle Crow project in Canada.

Notable results include 0.3m at 315.4g/t gold from 41.7m and 1m at 34.9g/t gold from 191.2m.

Step-out drilling in the Shaft 3 area has also extended the known mineralised vein structures with results such as 0.6m at 313g/t gold from 338.8m and 5m at 9.5g/t gold from 46.2m.

The gold play recently met the requirements to earn 51 per cent of the project and expects to meet the expenditure requirement to earn 80 per cent of Pickle Crow by the end of this year.

Over in the Victorian Goldfields region, First Au (ASX:FAU) is enjoying positive initial results from diamond drilling at its Snowstorm project.

Notable results include a 3.1m zone grading 11.6g/t gold from 53m including 0.8m at 33.3g/t gold from 54m.

The diamond drilling program is nearing completion with further assays pending from the laboratory.

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