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May 24, 2017

BMR Evening Market Musings…

Gold traded as high as $1,260 today, once again challenging that key resistance level…as of 7:45 pm Pacific, in this special evening edition of BMR Market Musings, the yellow metal is down $1 an ounce at $1,257…Silver is off slightly at $17.15…Copper is flat at $2.56…Nickel is up 2 pennies at $4.13…Crude Oil is 49 cents higher at $51.85 ahead of tomorrow’s OPEC meetings while the U.S. Dollar Index is off slightly at 96.94

Gold prices will witness a move higher amid increasing market doubts around the Federal Reserve’s resolve to pursue intensive monetary tightening into 2018, according to analysts at TD Securities

“The yellow metal may well trend toward a technically determined high of $1,2701,275,” TD Securities said in its Weekly Commodities report. “As the market starts to increasingly question the Fed’s determination to pursue a robust monetary policy tightening into 2018, Gold should benefit.”  TD believes the Trump administration will have difficulty pushing through its fiscal agenda – exactly what the left-leaning mainstream media is hoping as it continues to lead the Trump Resistance.  The TD report added, “It is very likely that the hundreds and hundreds of vacant positions waiting for officials in the bureaucracy will go wanting for quite some time, making the passage of regulations and writing of bills quite difficult.  No clear fiscal agenda means the U.S. output gap does not close quickly, inflation does not rise sharply, leaving the Fed without an impetus to tighten quickly or aggressively.”

Meanwhile, Fed minutes released today showed that Federal Reserve officials expected at their policy meeting earlier this month that it would “soon be appropriate” to raise short-term interest rates again, a signal the central bank will move at its gathering June 1314…significantly, the Fed also seems to have struck a consensus on a proposal to start gradually shrinking its $4.5 trillion in holdings of Treasury and mortgage securities later in the year…under the approach discussed, they would allow increasing amounts of those securities to mature over time, without reinvesting the proceeds…

Once the Fed starts to wind down its balance sheet, the idea that it will “double tighten” seems very unlikely – in other words, after 1 or 2 more rate hikes, the Fed will start focusing on its balance sheet and leave rates alone for a while…if the economy unexpectedly turns negative, they’ll also have the ability to adjust rates a little lower…this has to be interpreted as negative for the greenback and bullish for Gold

Moody’s Downgrades China

Moody’s Investors Service downgraded China’s credit rating today to A1 from Aa3…the catalyst for the downgrade was a combination of factors including expectations that potential growth would fall to 5% by the end of the decade…it was Moody’s first downgrade for the country since 1989…not surprisingly, China’s finance ministry didn’t agree with the move…in a statement on its website, the ministry said the downgrade was based on an “inappropriate method” and that Moody’s was overestimating the difficulties China’s economy faced, while underestimating the government’s efforts to tackle structural reforms and overcapacity…

Oil Update

Ahead of tomorrow’s big OPEC meeting, Crude Oil is trying to gain traction above $50 again which shows how Saudi Arabia still has the ability to move markets…keep in mind, the Saudis have every incentive to help push Oil prices higher given their war-strapped budget and the upcoming IPO of their state-owned Oil company, Aramco…the initial offering of 5% of the company is being timed for some point in 2018 and has been billed as the biggest ever with valuations reaching over $2 trillion…the IPO’s value will be largely determined by the price of Oil…Saudi Arabia said earlier this year that it wants to see Oil prices back near $60 a barrel in 2017

WTIC 15-Month Daily Chart

We cautioned a few weeks ago that the drop in Oil below key support at $48 may have been a “head fake”, a short-lived false breakdown…that’s indeed what it appears to have been as Crude quickly regained its technical composure and reclaimed the $50 level where the 50 and 200-day moving averages (SMA’s) now intersect…

Based on this chart, which has been exceptionally reliable, we have to continue to believe that WTI will eventually work its way into the low-to-mid-$70’s later this year or by early 2018, which would suit the Saudis (and many others) just fine…

U.S. Dollar Index:  Look Out Below! 

There is more trouble ahead for the U.S. dollar, perhaps not immediately but certainly over the summer during Q3, which supports the case for higher Oil and Gold prices and a breakout in the Venture above key resistance around 850

This long-term chart speaks volumes…the huge breakout in late 2014 in the greenback led to the final leg of the commodity downturn and an all-time low in the Venture by January 2016

Note the weakening trend in the RSI(14) after the 2015 peak including the RSI-price divergence late last year when the Dollar Index appeared to top out at 103.82

There’s now a President in the White House who wants to see a lower U.S. dollar, which helps Americans win on trade, and he’s getting his wish…

At a minimum, what we’re anticipating is a retreat to about 88 to 90 in the Dollar Index which would work out to about a 50% retracement of the gains since the 2011 low of 72.70…for this to occur, we’d expect to see a breakdown below 50% support in the RSI(14) on this long-term monthly chart…

The 200-day SMA, not shown here, is highly likely to start declining by August, if not sooner, and that will be a key technical trigger for an eventual drop in the Index to at least the 90 level…

In tonight’s Market Musings….

1. Jaxon jumps again…

2. CSR’s reach has just expanded…

3. White Gold’s torrid exploration and market pace…

4. Long-term Garibaldi chart is an eye-opener…

5. Daniel’s Den the Coeur MiningRockraven relationship…

Did you know that for as little as just over $2 a day, you can be a BMR subscriber and tap into the best analysis and picks for the junior resource sector that you’ll find anywhere?  Last year’s BMR Top 50 List returned a whopping 118% and we are delivering market-trouncing returns again in 2017BMR was the first to call the new bull market in the Venture in early 2016, and our coverage of the commodities space gives you valuable daily insights into price movements and critical trends.  BMR is daily information that puts you ahead of the crowd!

We also give first-time subscribers an industry-leading 100% money-back satisfaction guarantee.  If you don’t believe BMR has helped you make money for your first 6-month subscription period, we’ll refund your subscription fee in full – no questions asked!

Did you know that for as little as just over $2 a day, you can be a BMR subscriber and tap into the best analysis and picks for the junior resource sector that you’ll find anywhere?  Last year’s BMR Top 50 List returned a whopping 118% and we are delivering market-trouncing returns again in 2017BMR was the first to call the new bull market in the Venture in early 2016, and our coverage of the commodities space gives you valuable daily insights into price movements and critical trends.  BMR is daily information that puts you ahead of the crowd!

We also give first-time subscribers an industry-leading 100% money-back satisfaction guarantee.  If you don’t believe BMR has helped you make money for your first 6-month subscription period, we’ll refund your subscription fee in full – no questions asked!

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20 Comments

  1. Here is GGI News, sounds good but not happy with Cheap Financing.

    Garibaldi Survey Defines Multiple Large Conductors at E&L, Company Arranges $1.3 Million Financing

    TSXV: GGI
    OTC: GGIFF
    Frankfurt: RQM

    VANCOUVER, May 25, 2017 /CNW/ – Garibaldi Resources (TSX.V: GGI) (the “Company” or “Garibaldi”) is pleased to announce that a recently completed helicopter-borne Versatile Time-Domain Electromagnetic (VTEM) and Magnetics survey over the Company’s 100%-owned E&L deposit and immediate surrounding claims in the heart of the Eskay Camp has revealed multiple conductive anomalies with scale and signatures highly prospective for the discovery of new areas of nickel-copper-rich massive sulphide mineralization.

    Steve Regoci, Garibaldi President and CEO, commented: “While these interpretations are preliminary, as final review of a broad range of new data is completed over the next few weeks, there’s no question that first-ever modern geophysics at the E&L has further bolstered the case for a much larger mineralized system than what historical explorers assumed more than half a century ago.

    “We eagerly look forward to additional detailed analysis of the recently completed geophysics and the start of our ground exploration program in advance of this summer’s exciting drilling campaign,” concluded Regoci.

    Early highlights of the 600-line kilometer VTEM and Magnetics survey:

    – Five conductors (A-E) exhibit multi-line airborne electromagnetic (AEM) anomalies ranging from 500 meters to 900 meters in length;

    – Each of the five conductors features core areas of B-field responses, indicative of highly conductive bedrock sources as would be expected for significant accumulations of massive sulphides;

    – Anomaly signatures at A, B and C to the northeast indicate that these responses may in fact be part of the same mineralized system over a 3 kilometer trend;

    – EM response to the south of the high tenor E&L mineralized zones confirms the potential of this under-explored area to host massive sulphides.

    Garibaldi Arranges Financing For $1.28 Million

    Garibaldi is pleased to announce a non-brokered private placement to raise total gross proceeds of $1,280,000 CDN.

    The Company will issue 4,000,000 units at 14 cents per share (gross proceeds of $560,000) and 4,000,000 units of flow-through shares at 18 cents per share (gross proceeds of $720,000).

    Each common share unit at 14 cents comprises one common share in the capital of the Company and one full non-transferable share purchase warrant. Each warrant is exercisable into one common share at a price of 20 cents for a period of two years.

    Each flow-through unit at 18 cents contains one flow-through and one half of a non-transferable share purchase warrant. Each full warrant is exercisable into one common share in the capital of the Company at a price of 25 cents for a period of two years.

    All units from the private placement are subject to a 4-month hold period from the date of issuance.

    The financing will include finder’s fee commissions and is subject to TSX Venture approval. The proceeds from the flow-through financing will be used to advance the Company’s British Columbia properties. Proceeds from the non-flow-through financing are intended for the Company’s Mexico operations as well as general working capital purposes.

    E&L Geologic Model

    To view the E&L geologic model, and a comparative of nickel tenors, please visit the company’s homepage or the following URL:

    http://www.garibaldiresources.com/i/pdf/GGI-E-and-L-Tenor-Comparative.pdf

    New Eskay Camp Area Map

    http://www.garibaldiresources.com/i/photos/king/Eskay_Camp_May_2017_Inner_Core_Area_Map-min.jpg

    Qualified Person

    Mr. Everett F. Makela, P.Geo., Director and VP Exploration Canada for the Company, a Qualified Person as defined by NI-43-101, has reviewed and approved the scientific and technical disclosure in this news release.

    About Garibaldi

    Garibaldi Resources Corp. is an active Canadian-based junior exploration company focused on creating shareholder value through discoveries and strategic development of its assets in some of the most prolific mining regions in Mexico and British Columbia.

    We seek safe harbor.

    GARIBALDI RESOURCES CORP.

    Comment by diesel — May 25, 2017 @ 4:29 am

  2. Fantastic news on the GGI VTEM with more data still being crunched…

    Multiple large conductors suggestive of massive sulphides…

    Each of the 5 conductors is at least half a km long (up to 900 m) and 3 of them appear to be part of the same mineralized trend over 3 km…

    EM response south of the known mineralized zone confirm potential for massive sulphides (Q anomaly)…

    Money in the bank is critical – $1.3 million moves things forward IMMEDIATELY, including down in Mexico where Marlin Gold’s big high-grade gold intercept yesterday is right next to GGI’s ground.

    Comment by Jon - BMR — May 25, 2017 @ 4:39 am

  3. Who did the financing? Secutor for the FT? Kinda looked like a lid over the past week or so

    Comment by david — May 25, 2017 @ 5:03 am

  4. GGI has sharply reduced the use of Secutor since 2016, David, and Secutor is almost exclusively flow-through. GGI’s backing has broadened out considerably and I suspect there are multiple parties participating in this hard dollar and flow-thru PP.

    Comment by Jon - BMR — May 25, 2017 @ 5:41 am

  5. BLO news out… they will beat Hound Labs to the punch!!

    Comment by Jeremy — May 25, 2017 @ 5:51 am

  6. Vancouver, British Columbia, May 25, 2017 — Cannabix Technologies Inc. (CSE: BLO) (OTC PINK: BLOZF) (the “Company or Cannabix”) developer of the Cannabix Marijuana Breathalyzer for law enforcement and the workplace, is pleased to announce that Dr. David Hasman has joined its scientific team to initiate trials in Vancouver, British Columbia. Dr. David Hasman is with Forensic Science and Technology at the British Columbia Institute of Technology (BCIT) and has been providing his expertise in the LC/MS/MS method for fentanyl and analogues for the B.C. Provincial Toxicology Centre in Vancouver.

    Dr. Hasman received his PhD in Chemical Physics from the University of California and was a postdoctoral fellow at the University of British Columbia. Joining a Vancouver based laboratory he was involved in method development for therapeutic drug monitoring and was part of an effort to develop a mass spectral drug library for Agriculture Canada.

    After a career at Hewlett-Packard and Agilent Technologies Dr. Hasman taught chromatographic based analysis at BCIT and University of British Columbia. During that period, he joined BCIT Forensics Sciences and formed Procyon Research Inc. Procyon Research is involved in GC/MS and LC/MS/MS method development in forensics, natural products, and environmental disciplines.

    Cannabix is developing its FAIMS- (field asymmetric waveform ion mobility spectrometry) based marijuana breathalyzer for the detection of delta-9-tetrahydrocannabinol (“THC”) in human breath. The addition of Dr. Hasman to our Florida-Vancouver scientific team, will broaden our testing capabilities in Vancouver with human subjects using the Cannabix Marijuana Breathalyzer Beta prototype. The Company is substantially increasing its testing ability with new equipment and staff joining the Vancouver operation. Over the last several weeks, the Company has been developing a new “front end” breath intake system and calibrating decay signal intensities.

    Dr. Raj Attariwala, commented, “We are excited to have Dr. Hasman join our Vancouver team as we prepare for trials using the patented FAIMS device with court accepted techniques of mass spectroscopy. His expertise in toxicology and forensic mass spec have been instrumental with government toxicology labs during the recent fentanyl crisis in BC and his skills will be invaluable as we prepare for trials with the Cannabix marijuana breathalyzer device.”

    Comment by Jon - BMR — May 25, 2017 @ 5:56 am

  7. “EM response to the south of the high tenor E&L mineralized zones confirms the potential of this under-explored area to host massive sulphides. ”
    there is what, a few hundred meters to a Km max between the E+L high grade tenors and MTS property boundary which appears to be where the mountain slides down to a level area. It will be very interesting to see the maps one of these days

    Comment by david — May 25, 2017 @ 6:15 am

  8. Jon
    GGI, why the cheap flow thru financing? Why not wait and see if the VTEM news moves the stock then do the financing, no hurry as they are not going to drill for months at the E&L and no mention of Mexico for quite sometime and now all of a sudden he mentions Mexico when the total focus should be getting the word out on the E&L, not a vote of confidence from management in my opinion
    But why should I be surprised , Regoci will probably screw this up anyway…

    Comment by GREGH — May 25, 2017 @ 6:21 am

  9. Jon, I understand the excitement with GGI potential but yet again cheap financing–Warrants and paper.
    The Repeated creation of more overhang, blockage and selling of paper.
    The stock will have a very tough time reaching just .20 UNTIL 100% something rock solid has been confirmed.
    Will that time come, perhaps it will but just not right now.
    It seems GGI has always had that POTENTIAL, their properties look Fantastic BUT this has been years in the making and shareholders are still, still waiting for that follow through.

    Comment by diesel — May 25, 2017 @ 6:46 am

  10. GGI…. well another news release and another yawn by the market. Was really hoping this was the one to get it moving but it’s a no go on ignition. And another cheap financing.

    Comment by Weatheritout80 — May 25, 2017 @ 6:48 am

  11. Another cheap financing by GGI?, weatheriout? Come on, really…they are one of the very few companies, probably in the top 10%, that hasn’t diluted like crazy the last few years. Stock is behaving well, the technicals confirm that, and discerning investors will see where this is headed as drilling approaches at Nickel Mountain and things get going again in Mexico as well. This is a small financing ($1.3 million), leaving the door open for something bigger at higher levels as things develop. Keeps dilution to a minimum, which GGI has always done. I’m thrilled to see this PP because it’s money and great properties that moves stock prices. The PP price (0.14 and 0.18, hard dollar and FT) is certainly attractive but that’s what pulls in important players. Watch what unfolds.

    Comment by Jon - BMR — May 25, 2017 @ 7:06 am

  12. Jon… even you were hoping GGI wouldn’t have to finance at these levels.. you said it in your articles several times over the months. Anyways, it just adds pressure to the stock. I agree they definitely needed money.

    Comment by Weatheritout80 — May 25, 2017 @ 7:10 am

  13. GGI – Not sure if my last post was successfully submitted so don’t want to repeat. Essentially, ditto Jon and for a company that has protected shareholders from continuous dilution, unlike other companies, when they do a financing then it really is necessary. News will sink in – bet we close strong to end the week. Cheers

    Comment by Foz1971 — May 25, 2017 @ 7:21 am

  14. hopefully the money goes into Mexico and the numerous BC field projects and not the back pay for the office. that can happen when they do the next financing upon drill results from E+L.

    Comment by david — May 25, 2017 @ 7:24 am

  15. It’s just $1.3 million, weatheriout…my idea of a major financing is $5 million plus – that was the context of my comments. I was hoping they would not do that type of a financing at these levels and they aren’t. I suspect there are some really strong players who are in on this PP and that can only be a very good thing for all shareholders, it advances things immediately on all fronts.

    Comment by Jon - BMR — May 25, 2017 @ 7:31 am

  16. Sounds good Jon
    One other thing… in the news release does it subs like they found strong conductors on Nickel Mountain around the Ovoid? Kinda just sounds like they throw it in at the end of the news release that signatures are present… but they didn’t seem to elaborate. Not as strong add they thought???

    Comment by Weatheritout80 — May 25, 2017 @ 7:41 am

  17. They’re still interpreting data, weatheritout, and receiving new data…most companies don’t report on VTEM’s until quite a bit later than this but what they have initially is material and had to put out ASAP…the key thing is that the EM response confirms, as they said, the massive sulphide potential going south…it could be they have something really significant at depth there and need more time to analyze…you don’t always get instant answers on geophysics…much more to come yet on all of this…

    Comment by Jon - BMR — May 25, 2017 @ 7:48 am

  18. I suspect they had to do the financing now and for good reason, all of which should come out at a later time. they need money to drill, which may be soon. waiting to do the PP later only delays the process. I have no problem with this very small amount which is enough to sink the drills in the ground.

    Comment by dave — May 25, 2017 @ 8:13 am

  19. Fantastic news from GGI. I agree that the small PP was needed to keep this moving forward immediately. Good times coming our way!

    Comment by pole — May 25, 2017 @ 8:39 am

  20. totally needed the cash. boots are on the ground. the cash from the Chinese or well heeled investors that was rumoured about, back when the E+L additional land acq came about, never materialized. too bad.

    Comment by david — May 26, 2017 @ 6:42 am

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