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Gold is off slightly this morning…as of 4:40 am Pacific, the yellow metal is down $4 an ounce at $1,718…Silver has lost 28 cents to $33.44…Copper is flat at $3.82…Crude Oil has gained 51 cents to $101.42 while the U.S. Dollar Index has slipped one-tenth of a point to 79.06…

Moody’s put the United Kingdom, France and Austria on negative outlook last night, raising the prospect that the three countries would lose their triple- A ratings due to exposure to the the euro zone debt crisis…it’s the first time that the heavily indebted UK has been placed on negative credit outlook by a big rating agency since the euro zone crisis erupted…the warning by Moody’s that it may cut the triple-A ratings of two of the euro zone’s largest countries, France and the UK, has been met with resignation by analysts and economists…George Osborne, the UK chancellor, said the move supported the government’s tough austerity measures and was “a reality check for anyone who thinks Britain can duck confronting its debts”…

The Bank of Japan has eased its policy by boosting asset purchases and defined 1% consumer inflation as a near-term goal in response to growing calls for more action to help the economy mired in deflation and weighed down by a strong yen…in a move that surprised markets, the central bank added 10 trillion yen ($130 billion) to its asset buying and lending scheme, under which it buys government and private debt and lends cheap funds against various types of collateral…the $130 billion will be for purchases of long-term government bonds…

Stock index futures as of 4:40 am Pacific suggest a flat open this morning in New York…European markets are quiet and there was little movement in Asian markets overnight…

The TSX Venture Exchange declined 4 points yesterday to 1649…the Venture’s overbought daily technical condition has started to unwind, which is positive, and a retracement to the 1625 area is certainly very possible…this market is underpinned by strong support, so any pullback would present an excellent accumulation opportunity in advance of what we believe will be a powerful breakout through resistance around 1675 within the next few weeks…below 1625 there is excellent support near 1575 which is the Fibonacci 61.8% level as highlighted by John in Sunday’s chart…we’re very comfortable with this market right now and the direction it’s headed – the chart is undeniably bullish…

Arian Silver (AGQ, TSX-V)

After hitting a 2012 high of 39 cents early this month, Arian Silver has staged a normal retracement and closed yesterday at 32.5 cents…the downside from current levels appears very limited for a few reasons…first, Fibonacci support is at 29 cents and 31 cents…in addition, the now-rising 50-day moving average (SMA) is at 29 cents while the 100-day SMA at 31 cents has flattened out and will likely turn to the upside in the near future…so the overall technical posture of this stock at the moment is very positive despite the fact it hasn’t posted a daily gain since February 6…if you believe in Silver as we do, Arian is a nice overlooked play as the company is producing at its San Jose Mine in Mexico and developing a growing resource…below is John’s updated AGQ chart…

Note: John, Jon and Terry do not hold positions in AGQ.

Adventure Gold (AGE, TSX-V)

Adventure Gold is one of our long-standing favorites due to its strong management and quality portfolio of properties in Quebec and Ontario…the company’s Pascalis-Colombiere Gold Property near Val-d’Or intrigues us the most and developments there are being watched closely by Richmont Mines (RIC, TSX) which operates the Beaufor Mine immediately adjacent to Pascalis…below is a very interesting 3-year monthly AGE chart from John that shows how this stock is sitting right now in what we call the “sweet spot“…this is as close to a perfect entry point in a stock as one could ask for based on this chart (and the fundamentals which we know are strong with AGE)…

Note: John, Jon and Terry do not hold positions in AGE.

Corvus Gold Inc. (KOR, TSX)

A new play we’d like to bring to our readers’ attention is Corvus Gold (KOR, TSX) which has advanced projects in Alaska and Nevada, three of which have NI-43-101 compliant indicated and inferred resources…yesterday, KOR jumped 8 cents to 84 cents on nearly 500,000 shares after providing an exploration update on its North Bullfrog Project in Nevada including encouraging assay results from a major step-out hole…the company encountered near-surface mineralization in NB-12-117 (an intercept of 15.3 metres grading 2.36 g/t Au) which was drilled several hundred metres west of the current boundary of the Sierra Blanca resource…the hole confirmed historical drilling and it is possible the mineralization could be related to the deposit at Sierra Blanca…drilling continues at North Bullfrog and the company has also doubled the size of its land package there (to 50 square kilometres) with new staking that covers potential extensions of the North Bullfrog Gold system…KOR has just 42 million shares outstanding for a current market cap of $35 million…technically, the stock is up against a resistance band between 84 and 90 cents but that wall is likely to come down, if not immediately then over the short to medium term..patient investors have an opportunity to do very well with KOR…as always, perform your own due diligence…

Note: John, Jon and Terry do not hold positions in KOR.

Gold has traded between $1,725 and $1,724 so far today…as of 5:30 am Pacific, the yellow metal is up $6 an ounce at $1,729…Silver is 28 cents higher at $33.87…Copper has gained 2 pennies to $3.86…Crude Oil is $1.11 higher at $99.78 while the U.S. Dollar Index is off slightly at 78.72…

Stock index futures are pointing toward a strong open after the biggest single-day point loss on the Dow so far this year on Friday, though the setback was only 89 points…markets in Europe are up by as much as 1% while Asian markets were mostly mildly positive…

The TSX Venture Exchange will try to get back on track after declining last week for the first time in eight weeks…the Index closed Friday at 1654, just a couple of points below its 10-day moving average (SMA)…there is also strong support around 1625, just above the rising 20-day SMA…the possibility of a 5 to 7% pullback over the near-term can’t be ruled out, given the overbought condition on the daily chart, but the overall picture is extremely bullish and  a very robust March appears to be in the cards…the Venture’s 100-day SMA is about to reverse to the upside after being in decline since May of last year, adding further credence to our bullish analysis…this is definitely the time to be locking in positions – especially on any near-term weakness – in preparation for a major upside move that appears very likely…at the bottom of this morning’s report, John takes a look at three companies – Focus Metals (FMS, TSX-V), Geologix Explorations Inc. (GIX, TSX-V) and GoGold Resources (GGD, TSX-V) – with good prospects and encouraging charts…

Greece Approves Austerity Bill

Greece’s parliament approved a deeply unpopular austerity bill this morning to secure a second EU/IMF bailout and avoid national bankruptcy, as buildings burned across central Athens and violence spread around the country…cinemas, cafes, shops and banks were set ablaze in central Athens and black-masked thugs fought riot police outside parliament before lawmakers voted on the package that demands deep pay, pension and job cuts – the price of a 130 billion euro bailout needed to keep the country afloat…state television reported the violence spread to the tourist islands of Corfu and Crete, the northern city of Thessaloniki and towns in central Greece…police said 150 shops were looted in the capital and 34 buildings set ablaze…the citizens of Greece are paying the price for allowing their government to grow way beyond its means…

Not The Right Time For Austerity In America, Says The White House

Professor Obama will release an election-year federal budget today that is loaded with deficit spending and tax increases on the wealthy but avoids tough choices on the soaring costs of entitlements…the proposed budget would raise taxes by $1.5 trillion over the next decade and seeks billions of dollars for job-creating infrastructure projects, drawing a populist battle line with his Republican opponents…White House officials say the budget will propose a deficit of $901 billion in 2013, representing 5.5% of GDP, down from $1.33 trillion or 8.5% of GDP this year…Obama pledged back in 2009 to cut the deficit in half by next year, but his budget does not anticipate getting it back under 3% of GDP until 2018…overall, the budget proposes raising $1.5 trillion over the next decade through higher taxes on the “rich” with around half coming from allowing tax breaks for families earning more than $250,000 a year to expire at the end of 2012 – a longstanding Obama goal as he continues his class warfare politics and focuses on redistributing wealth rather than creating the conditions necessary to generate more wealth in America…government has run amok in Washington – Big Government is out of control – and has lost any right, in our view, to raise income taxes on a single person until it downsizes and gets its own fiscal house in order…in a stunning comment on NBC’s “Meet The Press” yesterday, the new White House Chief of Staff (Jack Lew) stated:  “I think there is pretty broad agreement that the time for austerity is not today”…if it’s not today, when will it be???…certainly not under the current President…

China Kicks The Debt Can Down The Road

China has instructed its banks to embark on a mammoth roll-over of loans to local governments, delaying the country’s reckoning with debts that have clouded its economic prospects…China’s stimulus response to the global financial crisis saddled its provinces and cities with 10.7 trillion yuan ($1.7 trillion) in debts – about a quarter of the country’s output – and more than half those loans are scheduled to come due over the next three years…

Charts

John has several charts to share this morning beginning with Focus Metals (FMS, TSX-V) which appears very close to staging a breakout…the stock gained 4 cents Friday to close at 81 cents…

Note: John, Jon and Terry do not hold positions in FMS…

Geologix Explorations (GIX, TSX-V) has been very active recently with encouraging drill results from the company’s flagship Tepal Gold-Copper Porphyry Project in Michoacán State, Mexico…GIX has completed a Preliminary Economic Assessment study (“PEA”) and has initiated resource expansion drill programs to further test the project’s potential…the GIX chart looks strong…the stock was down a penny Friday, closing at 32 cents…

Note: John, Jon and Terry do not hold positions in GIX.

Another situation we like in Mexico is GoGold Resources (GGD, TSX-V) which has started “Wave 1” of a new motive phase…the company’s promising San Diego Property in Durango, Mexico, comprises 71,000 hectares in one of the richest epithermal Gold and Silver belts in the world…management is strong with excellent track records…GGD closed at $1.60 on Friday for a market cap of just under $100 million…

Note: John, Jon and Terry do not hold positions in GGD.

TSX Venture Exchange and Gold

After posting gains for seven consecutive weeks, the Venture Exchange gave up 11 points last week to close at 1654.  The Dow suffered its worst trading session of the year Friday, falling 89 points, which contributed to weakness in other markets though the Venture rebounded somewhat from a 23-point intra-day loss Friday.

The “big picture” outlook remains extremely positive:  Significant global growth in money supply, easing of liquidity pressures in the euro zone, encouraging economic data out of the United States, a very accommodating Federal Reserve and a determination by China to focus on growth in the year ahead are all important factors that should power markets (including commodities) higher in 2012.  Add in the fact that there are still huge amounts of cash sitting on the sidelines – many retail investors remain scared and won’t jump in until later – and it’s not hard to come to the conclusion that now is the perfect time to get positioned in the best junior resource stocks in order to make potential fortunes over the next six to 12 months.

Ignore the noise from Greece – being defensive because of Greece was a winning strategy a year ago and even six months ago but not now.  The euro zone will muddle through its problems.  The trend is always your friend, and the primary trend with the Venture and markets in general is definitely up – perhaps a lot.

Having said that, a near-term 5 to 7% pullback in the Venture Exchange from current levels is very possible given current overbought conditions based on the daily chart.  Should this happen, we would view such a situation as a last-chance buying opportunity before an explosive move to the upside that would take out resistance around 1675 and lead the Index much higher. Check out John’s chart below.  There are three key support areas:  1625, 1569, and 1536.  One of those support areas is expected to hold on any pullback.  Then get ready for a major upside move as John’s recent long-term charts have shown.

Gold

Gold is in a similar technical situation as the Venture – an overbought technical condition (daily) may need to unwind a little more, so we just need to be patient.  The overall picture remains very bullish.  Gold was down for the second straight week but lost just a few dollars an ounce.

Silver, which gained over 20% in January, gave up 40 cents last week to close at $33.59.  Copper fell 6 cents to $3.83.  Crude Oil gained 83 cents a barrel to $98.67 while the U.S. Dollar Index finished essentially unchanged for the week at 79.00.

The “Big Picture” View Of Gold

As Frank Holmes so effectively illustrates at www.usfunds.com, Gold is being driven by both the Fear Trade and the Love Trade.  The transfer of wealth from west to east, and the accumulation of wealth particularly in China and India, is having a huge impact on Gold.

The fundamental case for Gold remains incredibly strong – currency instability and an overall lack of confidence in fiat currencies, governments and world leaders in general, an environment of historically low interest rates and negative real interest rates that won’t end anytime soon (inflation is greater than the nominal interest rate even in parts of the world where rates are increasing), massive government debt from the United States to Europe, central bank buying, flat mine supply, physical demand, investment demand, emerging market growth, geopolitical unrest and conflicts, and inflation concerns…the list goes on.  It’s hard to imagine Gold not performing well in this environment.  The Middle East is being turned on its head and that could ultimately have major positive consequences for Gold.

Welcome to our site, or at least the initial version of it!  BMR has been online for more than two years and strictly through word-of-mouth we have built a loyal following. 

We’re continuing with our plans to ultimately build a very unique investment and money-management resource site that goes considerably beyond what we have now.  While we focus very much on the Gold market and trends in the global economy, and of course the technical health of the TSX Venture Exchange (CDNX), an important component of this site will always be original research on undiscovered junior exploration companies or small producers, mostly in the Gold exploration space, that offer very real and significant upside potential. We are extremely selective in the companies we feature and put forward to investors – we prefer quality over quantity.  However, investors must understand that these are still highly speculative situations and entail considerable risk, volatility and unpredictability.  Our stock coverage is for informational and entertainment purposes only and must not be viewed or interpreted as “buy”, “sell” or “hold” recommendations. Always perform your own due diligence and please read our disclaimer at the bottom.

We use a combination of fundamental and technical factors in determining the value and potential of a stock.  In terms of fundamentals we look for a company with a superb project supported by strong management.  Management must possess integrity, solid ethics and a determination to succeed and build shareholder value.

At BullMarketRun (BMR) we approach the handling of money from a biblical perspective and this is an important topic we will be sharing with our readers (and listeners) as the site continues to develop. The Bible teaches so much about money and how to handle it and invest it –  there are literally thousands of verses on how we should handle the money and possessions that God entrusts us with.  By examining the life of Jesus and reading the Word of God, we can all become fully equipped to be successful investors and handle money wisely.  If it’s the other way around –  if you’re a slave to money by being in debt for instance, or if you don’t respect the value of money and spend it foolishly –  you’re in trouble and you’ll never be blessed financially.  We have a God who thinks big – He created the universe – and He wants us to think big  in every area of our lives.  When we handle money from a Biblical perpective (His money that we have been given stewardship of) He will bless our financial decisions and an increase of tenfold or a hundredfold is always possible.  This all begins, of course, with a personal relationship with Jesus Christ by accepting Him as your Lord and Savior and putting Him at the throne of your life.  It is the most important decision you’ll ever make.

God Bless,

Terry Dyer

Owner/Publisher, www.BullMarketRun.com

Disclaimer:

BullMarketRun.com (BMR) is completely independent from any companies it covers.  BMR accepts no compensation of any kind from any groups, individuals or corporations for coverage of any company mentioned on this site.  We accept no advertising either.  Our stock coverage is for informational and entertainment purposes only and must not be viewed or interpreted as “buy”, “sell” or “hold” recommendations. No investment opinion or other advice is being rendered on any stock or company. We strongly recommend that you consult with a qualified investment adviser, one licensed by appropriate regulatory agencies in your legal jurisdiction, and do your own due diligence and research before making any investment decisions. The stocks we cover, by definition, are highly speculative and potentially very volatile. Investors are cautioned that they may lose all or a portion of their investment if they make a purchase or short sale in these speculative stocks.  We are not Registered Securities Advisers. Our opinions can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Adviser operating in accordance with the appropriate regulations in your area of jurisdiction. It should be assumed that BMR personnel, writers and their associates may hold or dispose of or trade in positions in any securities mentioned herein at any time.  Owner/Publisher of BullMarketRun.com is Terry Dyer of Langley, British Columbia.

Forward Looking Statements:

All statements in BMR’s reports, other than statements of historical fact, may be forward-looking statements. These statements relate to future events or future performance. Forward-looking statements are often but not always identified by the use of words such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements.

Gold is weaker this morning…as of 5:50 am Pacific, the yellow metal is down $22 an ounce at $1,707…Silver is 55 cents lower at $33.35…Copper is off 9 pennies at $3.87…Crude Oil has slid $1.66 a barrel to $98.18 while the U.S.Dollar Index has jumped half a point to 79.10…

Stock index futures in New York, as of 5:50 am Pacific, are pointing to some weakness today which is not surprising given the recent run-up…we have been expecting this, so there’s no reason to panic…European markets are down as well…the TSX Venture Exchange has been up against short-term resistance lately and likely needs to back off a little and unwind a temporarily overbought condition as shown by its daily chart…any pullback would have to be viewed as a buying opportunity, so we like this kind of a day…

China Numbers – Look Beyond The Headlines

China’s trade in January fell the most since the depths of the financial crisis, raising concerns among some analysts that Lunar New Year factory shutdowns do not fully explain a slump in imports and may instead be evidence of a further faltering in demand…a careful look behind the headlines, though, shows that we really need to see February’s data before drawing any conclusions…Chinese imports sank 15.3% in January versus January 2011 – the lowest since August 2009 –  while exports fell 0.5% over the same period, the worst showing since November 2009, customs data showed this morning…it’s important to point out, however, that this may have been more calendar-related as there were fewer official working days in China in January of this year compared to January 2011…we really need to wait for the February data and lump the two months’ together before jumping to conclusions…nestled amid all the gloomy figures were some surprisingly upbeat data points…a January survey on China’s factory sector was brighter than expected…the country’s crude oil imports surged 7.4% in January to the third-highest level on record, which doesn’t mesh with a severe economic slowdown…copper purchases were up as well…money supply has been growing significantly in China recently and the government is now more focused on economic growth than fighting inflation, so China is not about to collapse as some pundits are suggesting…

Greece – The Circus Continues

Euro zone finance ministers dismissed as incomplete a reputed 3.3 billion euro package of Greek budget cuts presented to them in the hope of securing a 130 billion euro bail-out and sent the country’s finance minister back to Athens with a fresh set of demands and an urgent deadline…in exchange for signing off on the loan, which Greece is depending on to avoid a potentially chaotic default next month, its lenders are demanding further cuts to this year’s budget (330 million euros), parliamentary approval of a sweeping reform package and a pledge from the country’s political leaders to ensure they will maintain their commitment after April elections…Greece’s political leaders can be trusted with a pledge?????…

With its bloated bureaucracy, powerful unions, corruption, government dependency, the list goes on – Greece obviously needs some help on the political front…here’s a suggestion…how about we trade them Dalton McGuinty and Alison in Wonderland (Alison Redford, the new premier of Alberta) for future considerations?…with their ability to cook the books they could bamboozle everyone and turn the Greece situation around in a heartbeat…McGuinty could also consult with his friend David Suzuki and revive the Greece economy with a massive green energy program…Alison in Wonderland was magically able to find billions and billions of new dollars in Alberta yesterday (rainy day fund, lofty projections, etc., think what she could do for Greece!) to throw at all sorts of programs that liberals cherish and live for…what a great example of how taxpayers’ money to a government is like heroin to a drug addict…

Okay, back to reality – let’s look at a couple of charts…as we mentioned off the top, a minor pullback in the markets seems likely (this would also be healthy from a technical standpoint) and this morning John examines the leader of the pack which is the Dow…

Below is another chart of the Dow showing its supporting daily EMA(20) and a close correlation with commodities, the TSX and the Venture Exchange…in otherwords, any weakness in the Dow will likely spill over into these other markets…

There are many situations we like in this new bullish cycle for the Venture Exchange and one of them is Huldra Silver Inc. (HDA, TSX-V) which is working on advancing its Treasure Mountain Property (Silver, lead zinc) in British Columbia toward production…John’s 2-year weekly chart below shows increasing “big picture” momentum and a stock that has broken out of a downtrend…it closed yesterday at $1.37 for a current market cap of $43 million…any weakness in the coming days (for example, a pullback to around $1.20 or so) would make for a very good entry point…

Note: John, Jon and Terry do not currently hold positions in HDA.

Gold is beginning to firm up after touching an overnight low of $1,727…as of 5:30 am Pacific, the yellow metal is up $4 an ounce at $1,736 an ounce…Silver is a nickel higher at $33.99…Copper is up a penny at $3.89…Crude Oil is 74 cents higher at $99.45 while the U.S. Dollar Index is down nearly one-fifth of a point at 78.52…

Chinese inflation jumped in January, breaking a streak of five straight monthly declines, but seasonal factors were largely to blame and price pressures are expected to weaken in the coming months…the consumer price index rose 4.5% from a year earlier, up from December’s 4.1% pace…the main cause of the rebound was a shopping blitz before last month’s Chinese New Year holiday which pushed up good prices, an effect which has regularly been seen in the past and is likely to be temporary…core inflation, stripped of food costs, rose much more slowly, giving Beijing some room to stimulate the growing economy if necessary…

Asian markets were flat today while European markets are modestly higher…as of 5:30 am Pacific, futures are pointing toward a positive open in New York…in late breaking news, the Financial Times reports that Greek politicians have apparently reached an austerity deal which paves the way for more bailout money…

Copper, a leading indicator and an excellent barometer of the global economy, has climbed more than 12% this year – in line with the increase in the TSX Venture Exchange…both markets are up against short-term resistance at the moment, however, and may require a little more time to gather new energy and explode higher…below is an updated Copper chart from John…notice how the weekly EMA(20) – currently at $3.68 – has been a close supporting moving average in the past…it recently reversed to the upside and can be expected to provide support going forward…a breakout above the resistance band is likely but that may not occur until the weekly EMA(20) is successfully tested – we’ll see…the increase in buying pressure recently is impressive…Copper is definitely in a bullish state, so any potential near-term pullback should not be a concern as it would only be very modest and  temporary…great sign for the Venture Exchange…

Kaminak Gold Corp. (KAM, TSX-V), one of our favorite Yukon plays, has jumped over 50% since its December 15 low of $1.75 (it declined 9 straight days that month) which shows the importance of accumulating good quality stocks on weakness…for those who missed that move, however, Kaminak is still at a favorable entry point after closing yesterday at $2.70…the 100-day SMA has flattened out around $2.55 and should reverse to the upside in the near future…the Yukon will be a hotbed of exploration activity again this summer, so it’s almost a no-brainer to be positioned in KAM and some other good Yukon plays now and sell into strength in six months…below is John’s updated chart on KAM which recently staged an important breakout…

Note: John, Jon and Terry do not currently hold positions in KAM.

It has been a good week for traders/investors in Encanto Potash (EPO, TSX-V) which climbed 3 pennies yesterday to close at 35.5 cents on over 4 million shares (all exchanges)…momentum continues…as John’s updated EPO chart below shows, the stock appears to be in a trading range at the moment between 30 and 40 cents…it’s always important to keep in mind the support and resistance levels…ultimately, EPO should blast through the 40-cent level given a pending reversal in its 100-day SMA and other bullish technical factors…

Note: John, Jon and Terry do not hold positions in EPO.

Gold reversed yesterday and traded as high as $1,753 overnight…as of 5:25 am Pacific, the yellow metal is up $2 an ounce at $1,747…Silver is 17 cents higher at $34.32…Copper is up a nickel at $3.90…Crude Oil has gained 91 cents a barrel to $99.32 while the U.S. Dollar Index is off slightly at 78.47…

Fed Chairman Ben Bernanke was unmoved by a stronger than expected U.S. employment report last Friday, stating yesterday before the Senate Banking Committee that “the 8.3% no doubt understates the weakness in the labor market in some broad sense…while some employment indicators are improving, there are “a lot of people out of the labor force because they don’t think they can find work,” Bernanke concluded…

Despite signs the U.S. economy is gaining strength, the Fed is taking nothing for granted after seeing what happened last year…rates are staying low for an extended period and the recent growth in global money supply (according to ISI Group, 78 “easing” moves have been announced around the world in just the past five months and global money supply jumped 8% – $4 trillion – year-over-year in December) are fundamental factors pointing to a very bullish environment for Gold, commodities and markets in general…

There was a great quote from Dennis Gartman (hedge fund manager and author of the Gartman Letter) yesterday on CNBC…”The public is frightened of investing, and if the public is frightened we should be enthusiastic.”

Yes, we should be enthusiastic…the “big picture” outlook over the next 12 to 24 months for the TSX Venture Exchange is exceedingly bullish as John’s recent charts have shown…the market got a little ahead of itself in late 2010 and early 2011, so a nasty 1100+ point drop unwound that overbought condition in order to lay the foundation for the next major move, now underway, that could lead this Index back up to its 2006 and 2007 highs by sometime next year or early 2014…the Venture closed yesterday at 1663…

Stock index futures as of 5:25 am Pacific are pointing toward a mildly positive open…Asian markets were up strongly today with China’s Shanghai Composite gaining 56 points to close at 2348…if it breaks above 2400, watch out…

Let’s go back to Gold for a moment which appears to be gearing up to test a resistance band all the way up to $1,800…

Note: John, Jon and Terry do not own physical Gold at the moment (but we wish we did).

The CRB chart tells us a lot right now, too…below is John’s 2-year weekly chart update for the Reuters/Jeffries CRB Index which put in a double bottom and has broken above a downsloping trendline…

Great results yesterday from Cap-Ex Ventures (CEV, TSX-V) which jumped 14 cents to close at $1.13 on its best volume (1.8 million shares) in over two months…below is an updated chart on CEV as it approaches a resistance band between $1.20 and $1.25…

Note: John, Jon and Terry do not hold positions in CEV.

Prodigy Gold (PDG, TSX-V) released an update this morning on its Magino Gold Mine Project in northern Ontario…the company says it remains on schedule to complete a full feasibility study for Magino by late this year…Prodigy has been drilling at Magino since mid-January and will soon have six diamond drill rigs operating at the project…the additional rigs will allow Prodigy to complete its previously announced 60,000 metre resource definition, resource expansion and condemnation drilling program by this summer…when drilling is completed, the company will update its Gold resource estimate for Magino and integrate the results of the feasibility study into the overall project description for submission to the Ministry…the company hopes to begin construction at Magino in 2014 with mining underway by 2015…PDG closed at 82 cents yesterday, a penny below its rising 50-day moving average (SMA) which has provided consistent support for the stock since last October…

Gold has traded between $1,709 and $1,730 so far today…as of 5:30 am Pacific, the yellow metal is off $4 an ounce at $1,716…Silver is 26 cents lower at $33.42…Copper is down 6 pennies to $3.80…Crude Oil is off 85 cents to $96.06 while the U.S. Dollar Index is up slightly at 79.03…

Hong Kong’s shipments of Gold to mainland China in 2011 more than tripled from a year earlier, confirming China’s rapidly growing appetite for bullion, data released by the Hong Kong Census and Statistics bureau showed today…this came despite the Gold flow from Hong Kong to China dropping about 62% in December on the month to 38,605 kilograms, its lowest level since July…”The 38.6 tonnes shipped… might be interpreted by some as Gold-negative,” said UBS in a note…”We, however, think the real outliers were shipments in October and November, which were greatly in excess of previous months’ volumes…And while December’s activity is the lowest since July, it’s still 245.2% higher year-on-year…Here’s a statistic that should lay to rest any doubts over Chinese Gold consumption: the 2011 trend of imports from HK was up 258 percent from 2010“…

Fed Chairman Ben Bernanke is likely to repeat his case for a long period of low rates and will probably keep markets guessing about whether the Fed will do more quantitative easing as he appears before a Senate Committee beginning at 7:00 am Pacific…

Stock index futures are pointing toward a slightly negative open as of 5:30 am Pacific…

The TSX Venture Exchange closed at 1664 yesterday…the 10-day moving average (SMA) at 1640 and the 20-day SMA at 1600 are two support areas to keep in mind on any minor pullback…the Index will likely have to digest its recent gains before gathering the energy needed to blast through the 1675 resistance area…a very encouraging sign is that the 100-day SMA, in decline since last May, is flattening out and should reverse to the upside later this month which will add fresh fuel to this bullish new wave…the action in the Venture bodes well for Gold and commodities in general…

Canadian Prime Minister Stephen Harper has started an important visit to China where he’ll likely find greater interest in Canadian oil than from the White House…with four cabinet ministers, seven MP’s and 40 business executives and academics, Harper hopes to build on rapidly expanding ties that have pushed bilateral trade to nearly $60 billion U.S. a year in 2010…the Prime Minister has done quite the switch on China after refusing to attend the Beijing Olympics in 2008 and saying when he first came to power in 2006 that he didn’t think Canadians wanted him to “sell out” to China over the “almighty dollar”…from 2006 to 2009, China made no major investments in Canada but over the past two years the country has poured well over $16 billion into Canada which is counting only the largest energy deals alone, according to a report this morning in the National Post…China has a hugely growing appetite for resources and Harper’s visit also comes at a time when both countries are trying to give their respective economies a jolt…

Though it was down 39 points today to close at 2292, China’s Shanghai Composite Index has been looking healthier in recent weeks and we find that to be very encouraging in terms of the big global picture…there has also been a fairly close correlation between this Index and the Venture Exchange…John updates the chart for the Shanghai this morning – the “magic number” appears to be about 2400…a move through that yellow resistance band shown below would be a very bullish development…

It’s always important to keep a close eye on the direction of Crude Oil which has calmed down recently…this is stock market-positive and beneficial for Gold producers as well given that Oil is such a big component of their cost structures…for now, Crude appears to be stuck in a trading range between $90 and $100 a barrel…an Iran premium is certainly built into the current price even though Crude has been a little weaker lately…

We have one company chart this morning which is a new situation for our readers to check out – Newstrike Capital Inc. (NES, TSX-V) which has been reporting good results from its Ana Paula Project in Mexico, central to the company’s 90,000 hectares in the Guerrero Gold Belt…Ana Paula is at an advanced-staged exploration level…the company has a healthy market cap ($300+ million) but the chart is positive and a breakout at some point during the first or second quarter this year certainly seems possible…

Note: John, Jon and Terry do not hold positions in NES.

News just out on Cap-Ex Ventures (CEV, TSX-V) at 5:15 am Pacific…more positive drill results from the Northwest Zone of its Block 103 Property near Schefferville, Quebec…all three holes reported encountered significant near-surface iron mineralization including 148.4 metres at 30.6% Fe…the Northwest Zone is wide open to the south where thickness increases…more results from the Greenbush Zone (two kilometres from the Northwest Zone) at Block 103 are pending…this is truly a world class iron ore discovery and the company expects to have an initial NI-43-101 resource estimate by the end of the year after an aggressive 2012 exploration program…

A company under 20 cents we’re keeping an eye that we like is Cascadero Copper Corp. (CCD, TSX-V) which closed yesterday at 17.5 cents…there’s no need to “chase” CCD at the moment but we do like its prospects for 2012 and we suggest readers check into it…