Gold is off $3 an ounce at $1,260 as of 8:30 pm Pacific after blasting through key resistance at $1,240 this morning (this is another rare evening edition of BMR Market Musings due to an extended site visit)…Switzerland’s central bank caught markets by surprise and triggered some turmoil today after it unexpectedly scrapped a cap on the franc-euro rate, underscoring growing concerns about global economic prospects…Silver is up 11 cents tonight at $17.07…Copper has added 2 pennies to $2.61…Crude Oil is up slightly at $46.57 while the U.S. Dollar Index has gained one-tenth of a point at 92.21…
Trust in central banks took a hit today with the decision by the Swiss National Bank which caught markets completely off guard (for some investors, that meant huge losses – leveraged investors and asset managers were substantially short the Swiss franc according to CME data as of last week)…just a month ago, on December 18, when it cut interest rates into negative territory, SNB President Thomas Jordan had repeated a pledge to buy foreign currencies in unlimited quantities to enforce the cap with “the utmost determination”…when central banks start losing credibility, all heck can break loose…
Interventions to continually enforce the cap, introduced in September 2011, had swollen the SNB’s balance sheet massively (in December the central bank aggressively bought euros to maintain its minimum rate)…today’s action appeared to be an attempt to move ahead of the risk that the ECB announces full-blown QE as early as next week, which would put additional pressure on the euro…a rising franc, meanwhile, will most certainly have consequences for the Swiss economy…
We are in uncertain times, and that’s when Gold’s “safe haven” status can really come into focus…bullion closed more than $30 higher today and is on track for its biggest weekly percentage gain in a year…in euro terms, Gold hasn’t been this high since the spring of 2013…in tonight’s Musings, we have 2 new Gold charts plus an interesting Gold-Oil comparative…
Global Growth “Too Low, Brittle And Lopsided”: IMF Director
Two problems stemming from the 2008 financial crisis – heavy government borrowing and high unemployment – still pose challenges to the global economy and require bold action, the head of the International Monetary Fund said today…Christine Lagarde, IMF managing director, said that cheaper Oil and strong U.S. growth aren’t enough to counter those threats…
“We believe that global growth is still too low, too brittle and too lopsided,” she said in remarks before the Council on Foreign Relations…Europe and Japan potentially face years of slow growth and ultra-low inflation, she said, while the U.S. “is the only major economy that is likely to buck that trend this year.”
Today’s Equity Markets
Asia
Japan’s Nikkei is under pressure tonight, down over 400 points or 2.5% on the final trading day of the week…China’s Shanghai Composite, however, is up 35 points at 3371 as of 8:30 pm Pacific…
Europe
Major European markets were sharply higher in Thursday trading on the news from the SNB, but nearly $100 billion was knocked off the value of Switzerland’s stock market as the Swiss Market Index suffered its biggest 1-day fall since 1988 – it closed 9% lower…
North America
The Dow fell 106 points today, its 5th straight daily decline…tomorrow, data from the Labor Department should show the U.S. is well on its way to joining the Deflation Club in December…economists expect a drop in the headline consumer price index from the previous month which would bring the year-over-year pace to its lowest since the fall of 2009 when the economy was climbing out of recession…
The TSX was cushioned by a sharply higher Gold Index today but still lost 43 points to close at 14042…the Venture, meanwhile, fell 1 point to 659 despite bullion’s big move…producers and near-producers benefited the most by the yellow metal’s breakout…
Cannabix Technologies Inc. (BLO, CSE) Update
Cannabix Technologies (BLO, CSE; BLOZF, OTC) is our “Golden” non-resource play…it’s a first-mover in marijuana breathalyzer technology, and we have a high level of confidence that the upcoming Cannabix Breathalyzer prototype will create a powerful new dynamic for this company in the market…
Technically, there is no question that momentum is building in BLO as demonstrated by the RSI(14), rapidly increasing buy pressure, and the ADX trend indicator…
Below is the U.S. chart for Cannabix (CSE charts are not available yet on Stockcharts.com)…the 50-day SMA has been rising since late December, while the 100-day (not shown on this chart) has flattened out and is now beginning to reverse higher as well…this is the “sweet spot”, perhaps a final chance for investors at current levels in advance of another potential breakout as suggested by the technical posture here…
Gold Short-Term Chart
Gold’s breakout above the Fib. 50% level today was confirmed by high volume…
Gold bulls should hope for a strong weekly close Friday, ideally above the next Fib. level which is $1,263…RSI(14) is showing impressive up momentum and therefore will likely push above the 70% level in the immediate future…chart resistance is at $1,290 and $1,340, so the $1,300 area is where Gold does face a major challenge…
Gold Long-Term Chart
Two critical “takeaways” on this 20-year monthly Gold chart:
1. Support for Gold has held at the uptrend line going back to the start of the bull market in 2001;
2. Gold last year broke above a multi-year RSI(14) downtrend line and is now moving sharply higher.
Goldman Sachs took a beating on the Swiss Franc today, and it ought to be very concerned about its bearish position on Gold…
Gold-Oil Comparative Chart
Historically, Gold and Oil have tended to dance together…that relationship has been broken, temporarily at least, as bullion has stepped out boldly on its own…
Gold hasn’t performed this well against Oil in a relative sense in 20 years…expect this trend to continue as bullion benefits from the destabilization effects of extended depressed Crude prices…
TSX Gold Index Updated Chart
The key level to watch on the TSX Gold Index is 175…some producers are enjoying the triple-whammy benefit of higher bullion prices, a low Canadian dollar and plunging Oil prices (it doesn’t get any better)…
Richmont Mines (RIC, TSX) Update
Our favorite producer remains Richmont Mines (RIC, TSX) which shot up 49 cents today to $4.09 on the jump in Gold and some very positive news, including higher than expected 2014 Gold production of 95,208 ounces…
Richmont’s Island Gold Mine and the high-grade deep resource there will continue to transform this company over the next couple of years after a very profitable turnaround year in 2014…
Next measured Fib. resistance on this 4-year weekly chart is $5…
Note: John and Jon both hold share positions in BLO.
BMR – We are in uncertain times, and that’s when Gold’s “safe haven”
status can really come into focus
Bert- Do anyone really think that although Gold may eventually shine,
traders will, during uncertain times, jump into the Venture exchange
stocks. in particular, those which have struggling for all the right
reasons, that is, they never did have any value in the first place,
although they, the companies tried to make us believe otherwise.
Comment by Bert — January 16, 2015 @ 5:46 am
I’ve been thinking the same thing Bert, most people are going to go to the safe companies that have proven reserves or more likely that are actually producing. This low oil price is effecting all businsses where I live. Schulmberger announced they were laying off 9,000 people yesterday. Where are those people going to find jobs in an already weak job market?? I think we are looking at tough times ahead. Hope I’m wrong, good luck to all.
Comment by Greg — January 16, 2015 @ 8:33 am
Westwood Mill Permitted to Process Granada Ore
(via Thenewswire.ca)
Rouyn-Noranda, Quebec / TNW-ACCESSWIRE / January 16, 2015 / Gold Bullion Development Corp.(TSXV: GBB) (OTCPINK: GBBFF) (the “Company” or “Gold Bullion”) is pleased to announce another important step toward its high-grade “Rolling Start” at the Granada Gold Project as Iamgold Corp. has received its amended Certificate of Authorization to process Gold Bullion’s LONG Bars Zone ore at the Westwood Mill.
Frank J. Basa, Gold Bullion President and CEO, commented: “2015 is shaping up to be a transformational year for our company as we complete the final steps to put the Granada Gold Property into production while we also ramp up efforts to unlock the exciting full potential of the LONG Bars Zone resource which remains open in multiple directions.”
The Certificate of Authorization for the mining operation at Granada is the only outstanding permit yet to be granted by the Quebec Ministere du Developpement Durable, de l’Environnement et de la Lutte aux Changements Climatiques (“MDDELCC”).
Qualified Person
Claude Duplessis, P. Eng. of GoldMinds Geoservices Inc., consultant for Gold Bullion, has reviewed and approved the contents of this
Read more at StockHouse Website
Comment by Pete — January 16, 2015 @ 10:18 am
NEWS…….From V.GBB
Read at StockWatch Website
Comment by John BMR — January 16, 2015 @ 10:38 am
VGD has some nice volume today. cup and handle breakout?
Comment by doublejay — January 16, 2015 @ 10:59 am
I doubled my position when VGD came back down again to the .09 area. I’m in heave at .095 and .10
Comment by dave — January 16, 2015 @ 11:09 am
typpo – VGD in heavy
Comment by dave — January 16, 2015 @ 11:10 am
I also would keep a watchful eye on NXE. I just bought at .32 – Its doing a hammer candle so far. Its next to FCU.T
Comment by dave — January 16, 2015 @ 11:25 am
Gold Bullion Development Corp near production: Read more at Gold Bullion Development Corp Wesite…
Comment by Arjan Hanegraaf — January 16, 2015 @ 11:42 am
Dan – TLT has trouble breaking that .50 spot. I’m not in it but I am pulling for you buddy. I stick to my guns on TA. I do have a bid in at .38. Lets see what happens down the road.
Comment by dave — January 16, 2015 @ 11:54 am
Alert Alert Alert
Jon must have tripped over several gold and silver bars and struck his head – never got up – LOL When will you report on your site visit?
Thanks,
Comment by Dan — January 16, 2015 @ 12:31 pm
One other stock that has really looked good the last couple days is Cannabix. One thing I have learned over the years is that volume doesn’t lie (or rarely does) and a lot of people have stepped up to the plate the last couple days to buy it. Looking very good.
Comment by Danny — January 16, 2015 @ 6:17 pm
Guys put BHS on your radar. Exciting oil play and silver mine will be in production soon!!
Look for breakout on BHS this coming week.
Comment by Jeff — January 17, 2015 @ 8:12 am