Gold has traded in a narrow range between $1,165 and $1,171…as of 9:15 am Pacific, bullion is up $2 an ounce at $1,168 on this U.S. holiday (we wish our American friends a safe and happy 4th of July long weekend)…Silver is unchanged at $15.68…Copper has retreated 2 cents to $2.60…Crude Oil has tumbled $1.43 a barrel to $55.50 while the U.S. Dollar Index is off one-tenth of a point at 95.98…despite chaos in Greece, the euro is up slightly at 1.11…
As the 2nd quarter came to an end, and metals prices remain range-bound, Gold and Silver coin sales have seen a surge this past month, up over 100% in June after dismal May sales, according to one bank…
“Sales of Gold coins by the U.S. Mint have now risen by 150% m/m for the 4 weeks of June,” said analysts from Barclays in the bank’s Gold Delta report released this week. “Total sales have now turned positive for a y/y basis, rising by 20%.”
Zinc Market Flips Into Surplus
The world Zinc market is flipping into surplus for the first time in 3 years…Japan will join China in boosting Zinc exports as domestic demand weakens, worsening a global glut, according to the top Japanese producer of the metal…shipments from Japan may rise 24% to more than 100,000 metric tons this year, the highest since 2013, according to Osamu Saito, general manager of Tokyo-based Mitsui Mining & Smelting Co.’s metals sales group…domestic demand may shrink to a 6-year low, he said…Zinc futures on the London Metal Exchange are down 7% this year as cooling Asian demand has outweighed mine closures elsewhere…
Confusion In Greece Ahead of Sunday Referendum
Supporters of Greece’s bailout terms have taken a razor-thin opinion poll lead over the ‘No’ vote backed by the far left government, 48 hours before a referendum that may determine the country’s future in the euro zone…the poll by the respected ALCO institute, published in the Ethnos newspaper today, put the ‘Yes’ camp at 44.8 vs. 43.4% for the ‘No’ side…but the ‘Yes’ lead was well within the pollster’s 3.1 percentage point margin of error, with 11.8% saying they are still undecided…given a volatile public mood and a string of recent election results that ran counter to opinion poll predictions, the result is in effect completely open…
A ‘Yes’ vote could end (hopefully) the political career of Prime Minister Prime Minister Alexis Tsipras, who has already alienated euro zone leaders…he has urged Greeks to reject the “humiliating” terms offered last week by international creditors in a deal that is no longer on the table, and accused lenders of “blackmail” by withholding credit…
Tsipras, who was a member of the Young Communist Society in the 1980‘s, is a reckless, delusional, unpredictable individual who swayed naive Greece voters in Obama fashion earlier this year with his telegenic looks and promises of “social deliverance”, whatever that means…Greece put the Syriza party into power based on the “personality power” of Tsipras without much thought with regard to his policies or his team and what they stood for (doesn’t that sound just like what happened in Alberta?)…
The outcome of the referendum should help the European Central Bank decide whether to raise its assistance to the Greek banking sector…its emergency funding has helped to keep the banks afloat as capital bled out of them, but has been capped since talks between Greece and its international creditors broke down…
Yanis Varoufakis, the country’s finance minister, said in an interview with Bloomberg yesterday that he thinks the banks will re-open on Tuesday…however, there are not many who share his optimism…the country is in complete disarray at the moment…
Crude Oil Update
Some technical weakness has crept into our 6-month daily WTIC chart with RSI(14) falling below previous support, buy pressure reversing to sell pressure, and -DI crossing above +DI…WTIC is also now trading below its 50-day moving average (SMA) for the first time since early April…
Despite repeated attempts, WTIC was not able to sustain a price above $62…it may try again later this quarter…for now, Fib. support between $52 and $54 is critical and needs to hold…
Fundamentally, traders have reacted negatively to an increase in the U.S. Oil rig count (by 12 to 64) after that number fell for 6 straight months…according to ANZ Bank, U.S. share producers have brought down their break-even cost from $35 to $20 per barrel…
Meanwhile, Goldman Sachs stated this morning, “The current U.S. horizontal and vertical rig count across the Permian, Eagle Ford, Bakken and Niobrara shale plays implies that U.S. Oil production growth will reach 135,000 barrels per day year-on-year by Q4 2015.”
The rising U.S. rig count adds to near record production by OPEC and Russia…
Today’s Equity Markets
Asia
Another bad day for China’s Shanghai Composite, which has broken below its uptrend line from last summer and will now likely test Fib. support around 3400…the Shanghai ended down another 5.8% today…it lost 12.1% this week and has lost more than a quarter of its value since a high on June 12…
After Thursday’s sell-off, the China Securities Regulatory Commission (CSRC) said it would launch an investigation into suspected manipulation of shares and futures, adding it has tracked irregularities in trading and it would transfer any criminal cases to the police…according to data provider FactSet, 125 stocks in the Shanghai Composite and 352 stocks in the Shenzhen Composite were halted today…
Over the past week, Chinese officials have dug deep for measures to stop the equity sell-off…still, the array of attempts – from lifting restrictions on investing with borrowed funds to cutting interest rates – so far have failed to encourage investors to buy…
Europe
European markets were down modestly today ahead of Sunday’s referendum in Greece…
North America
U.S. markets are of course closed to celebrate Independence Day…as a result, it’s a light trading day in Canada with the TSX up 16 points at 14654 while the Venture flat at 671…
S&P 500 Long-Term Weekly Chart
On this U.S. holiday, we take a look at a 20-year weekly chart for the S&P 500 which closed yesterday at 2077…what’s concerning about this chart is the divergence between price and RSI…
RSI has been trending lower while the market has risen to new highs…it’s important to point out, however, that this could continue for a while longer, as it did from 1997 through 2000, so a substantial decline isn’t necessarily imminent – especially with the Fed seemingly reluctant to hike interest rates…but this bull market is clearly aging and may not last the full final term of Obama’s Presidency (trouble probably on the horizon at some point in 2016)…
TSX 6-Month Daily Chart
The TSX has been in a clearly defined downsloping channel since early May, with Fib. resistance at 14700 and 14900…Wednesday’s intra-day low 14482 was the bottom of the downsloping channel…a break below the channel would suggest a test of base support around 14000…
Doubleview Capital Corp. (DBV, TSX-V) Update
At BMR, sometimes our readers say it best…
“Farshad has the biggest balls in the North American mining industry. Put simply, if this hits like they obviously think it will, these guys will be rock stars at next year’s PDAC and I mean rock stars.” (Don)
Indeed…in a bold move but one driven by an acute understanding of the Hat’s geological, geophysical and geochemical dynamics, Doubleview has stepped out a whopping 1 km from H-23 and the Lisle Discovery Zone with hole 24 currently being drilled in an area where a strong anomaly (magnetic, chargeability, potassium, Copper and Gold geochemical) has been outlined…
We’ll have much more next week on how the A-1, A-2, A-3, B (Lisle Zone) and E areas at the Hat appear to form a single and very large Gold-rich alkalic porphyry system, as postulated by DBV‘s technical team led by chief geoscientist Dr. Abdul Razique…after his critical involvement over several years with one of the world’s largest porphyry deposits (Reko Diq) with Copper giant Antofagasta, Dr. Razique knows how these systems form and how to prove them up…
At the Hat Complex, there are also areas C, D, F, G and the Hoey and Gossan Creek prospects, so this is truly shaping up to be a world class discovery that may also have a clone at the adjoining Grizzly Property where Garibaldi Resources (GGI, TSX-V) has identified multiple targets with similar signatures…first-ever drilling this summer at the Grizzly could easily result in another discovery given the expanded knowledge of the entire district and the specific signatures that ought to be drilled…
Technically, DBV is showing increased momentum and an imminent challenge of the Fib. resistance band between 19 and 23 cents appears to be in the works…DBV is up a penny at 17 cents as of 9:15 am Pacific…
BitGold Inc. (XAU, TSX-V) Update
BitGold (XAU, TSX-V) responded well yesterday to news of its June performance indicators…this is a volatile play, so it’s important to understand the resistance and support levels as XAU swings from overbought to oversold conditions…
RSI(2) is currently at 95%…keep an eye on the uptrend line (as support, safer entry point) and the Fib. levels…
Note: John and Jon both hold share positions in DBV and GGI.
If one includes areas A , ( B ,the Lisle zone ) and area E I’m coming up with a lot more than 2 billion tonnes , more like 5 with a depth of 650 meters and it gets a lot bigger if the death goes to 1000 meters . No reason why it couldn’t as Red Chris is deeper in some areas with one hole at 1400 meters Good luck to all and keep the news flowing with the coming drill results.
Comment by Les — July 3, 2015 @ 10:12 am
Volume is so low for DBV… cannot understand the reason … Can someone tell me?
Comment by Theodore — July 3, 2015 @ 3:06 pm
Theodore- Jr. mining stocks are out of favour and it is being reflected in the Venture Exchange at present . It seems no one wants to risk Capitol in exploration stocks. This is concerning but we will see what happens through next week. If investors don’t take an interest it may take the next hole results to move DBV to a higher level . As long as DBV can continue bringing up excellent core samples at some point a major will most likely step into the picture as this find will be too big to ignore . People will be then kicking themselves why they didn’t pick shares up on the cheap . I have every confidence that Farshad and his team will accomplish what they have set out to do . IMHO
Comment by Les — July 3, 2015 @ 5:41 pm
My thoughts, and this would apply to GGI is that we are in the summer doldrums and the market still sucks in the junior sector. It will take some good drill results to really move things, even that may not do it right away. Having said that this provides a great opportunity to accumulate for the patient investor. I know everybody is tired of being patient but I think people need to manage their expectations a little better.
Comment by Danny — July 3, 2015 @ 6:03 pm
Theodore, miniscule volume on Venture today with U.S. holiday – many investors (both sides of the border) haven’t even seen DBV news yet. Expect volume jump next week. Don’t forget, Colorado came out of nowhere in a horrible market during spring 2013 with just 1 hole and surged on huge volume to $75 million market cap. Hat already has North ROK beat all to heck and 23/24 could create a spectacular surge in both price and volume, regardless of overall market conditions. Next week will be interesting.
This play alone – and the district – have the potential to revive interest in the junior exploration sector as a whole. Exactly what the Venture needs.
Comment by Jon - BMR — July 3, 2015 @ 6:40 pm
For the moment DBV find a big potential, the grade is not enough good for create volume to moved up but he find enough good to watch what is coming and be ready to jump in the company with a good grade and probably the result of the hole 23 we shall bring this volume with a new step and the hole 24 shall bring that any investors will dream !
Comment by Guy Delisle — July 3, 2015 @ 7:27 pm
Guy
You really shouldn’t drink and post,lol
Comment by Greg — July 3, 2015 @ 10:17 pm
I don’t believe Farshad has the biggest balls in North America……he has one of the best technical teams in N.A which allows him to take these chances with good odds of success.
I know for fact that Dr Razique wouldn’t be doing this unless he was sure he would hit……I don’t expect the step out to be disasterous like CXO when they stepped out from their discovery hole. I think it will be another discovery hole.
I really think that the price will move on h23 then creep up in anticipation of h24 and then really move if h24 is another discovery hole. If h24 is another discovery hole then Dr Razique’s theory will be proven and majors will come knocking……just think how much tonnage this could add up to if he is right!
The last two days the bids have been at their best in months and asks are at their thinnest in months as well. A lot of the shares are in very strong hands….held by people like myself that think this will be taken over by a major before the then end of next year and possibly sooner.
I have been in DBV since the start of initial drilling….my patience will be greatly rewarded imo……
Comment by d4 — July 4, 2015 @ 2:46 am
Thank you Les, Jon… I always enjoy reading here.
Comment by Theodore — July 4, 2015 @ 6:05 am
Farshad morgtaged his house and spent almost every nickel he had to drill holes 7 thru 11 in late 2013 – that took incredible courage and faith, especially in those market conditions, and he hit 2 discovery holes that sparked one of the few staking rushes we’ve seen in Canada in recent years, turning DBV into a 10-bagger.
The way this is going, this has all the makings of major new Canadian discovery, worthy of a book actually given the dramatic way this has all developed.
The odds are very good that Razique will nail this on the step-outs. Critically, he understands the geometry of the system, the controls on mineralization, and how to drill this going fwd. I like the odds. Not 100% of course, but as good as it gets in this industry.
Comment by BMR — July 4, 2015 @ 7:11 am
Speaking of CXO, it is time to once again put it on watch list as it has a red hot prospect and is ready to drill soon. Richard l
Comment by richard l — July 4, 2015 @ 7:33 am
GGI news next week? would be about time.
Comment by Martin — July 4, 2015 @ 5:58 pm