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Gold has traded between $1,264 and $1,279 so far today…as of 9:00 am Pacific, bullion is flat at $1,270…Silver is also unchanged at $17.22…Copper is steady at $2.05…Crude Oil has dipped $1 a barrel to $49.54 while the U.S. Dollar Index has rallied one-quarter of a point to 94.41…

Holdings in SPDR Gold Trust, the world’s largest Gold-backed exchange-traded fund, rose 0.71% to 887.38 tonnes yesterday, the highest since October 2013…year to date, all-ETF investment in Gold has risen by 12 million ounces to 52 million ounces…

Gold continues to benefit from multiple factors including negative yields across many parts of the globe…the 10-year Japanese government bond yield hit a record low of minus 0.155% today while British and German sovereign debt yields also fell to record lows on jitters ahead of Britain’s referendum on European Union membership later this month, as well as the ECB’s commencement of its corporate bond purchase program…

Jim Steel, chief commodities analyst at HSBC, observed: “As far as the geopolitical element, it’s certainly not a chicken little atmosphere.  I think there’s enough uncertainty facing the global economy and even some geopolitical tensions to keep buying the Gold market.”

“I think the key element more than any one geopolitical issue, even as much as the Fed holding off a spate of rate rises, is some economies moving into negative rates. That has been very good for Gold. When you look at when the Gold rally began it is very close to the issue of bonds with a negative yield.  If you look at all the economies that have a negative yield, they add up to a little over 27% of the world’s GDP.  Negative yields are a powerful cocktail for Gold. They eliminate the opportunity cost of owning Gold,” Steel concluded.

The Supernova About To “Explode”

Bond guru Bill Gross believes the growing global move toward negative yields will have dire consequences…in a tweet this morning from his firm, Janus Capital, Gross went back half a millennium to assert that the current situation with the world’s debt market is unprecedented and dangerous.  “Global yields lowest in 500 years of recorded history. $10 trillion of neg. rate bonds. This is a supernova that will explode one day.” 

How soon that day will be, and how Gross tracked bond yields back to the 16th century, we’re not quite sure…but the fact remains, the trend toward negative yields has been accelerating rapidly and that can’t be viewed as a good thing – unless you’re invested in Gold…

Oil Update

Baker Hughes rig data comes out at 10:00 am Pacific, and investors will be paying close attention to those numbers…at $50 per barrel, analysts have expected to see a return of some drilling activity in the U.S., and last week’s data showed 9 Oil rigs were added…that makes a total of just 10 new rigs this year…

A drop in U.S. production, supply disruptions in Nigeria as well as strong overall demand for Oil, especially from refineries, have given WTI prices a strong bid and pushed them above $50 a barrel this week for the 1st time since July of last year…

The bear market in Crude Oil ended in mid-February at $26.05, just a few weeks after the Venture finally hit bottom at 466, and WTI prices are now at their highest level in nearly a year…as a result, the 200-day moving average (SMA) has reversed to the upside, confirming the change in the primary trend…a strong new support band now exists between $42 and $46, so any pullback is highly unlikely to dip below that area…

By early summer it’s reasonable to expect WTI to challenge resistance around $54 a barrel…risks are skewed to the upside, the opposite of the situation at this time last year…

In today’s Morning Musings…

1.  “More upside and potential than originally realized” in exploration at Cajueiro: Equitas Resources (EQT, TSX-V) CEO…

2.  Athabasca Nuclear becomes Clean Commodites (CLE, TSX-V)…

3.  More capital pours into Lithium sector – Nemaska Lithium (NMX, TSX-V) to raise $50 million…

4.  Gainey Capital (GNC, TSX-V) targets high-grade zones in early drilling at El Colomo in Mexico…

Plus more…click here to take advantage of our Spring Sizzler Subscription Special in effect for a limited time only, or login with your username and password to view the rest of today’s Morning Musings… 

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