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Markets have been in the red all day, though Gold has bounced back from a low of $1,622 to a current price (as of 12:10 pm Pacific) of $1,637 – a loss of $5 an ounce on the day.

The already oversold CDNX has become even more oversold today and is currently down 30 points to 1368 with 50 minutes left in the trading session – it’s still within the support band outlined in John’s chart Saturday.

Some investors assume that a market bottom will be accompanied by high volume – historically with the CDNX, that has often occurred but not always.  Most recently, the CDNX declined from a high in the first quarter of 2011 to a low in October and then retraced again to a low after a bounce.  Each of those lows did have a high volume “capitulation”, so at this point it’s possible that most of the weak shares may already have been sold off.  Hence the declining volumes lately toward a low.

One thing is certain – it makes a lot more sense to be a buyer right now than a seller. Greed enters the picture at both ends of a market – near a top, when investors want to hang on for just a little longer to squeeze out more profits, and near a bottom when savvy investors know it’s likely a good time to buy but they want to wait to get in at the very bottom which of course is virtually impossible.  If you think this market is within less than 10% of an important low, as we do, then now’s the time to be jumping in.  One of the recipes for investor success is getting out within 10% of a market top or getting in within 10% of a market bottom – easier said than done given our fear and greed emotions.

The FMOC meets tomorrow and Wednesday which could be a defining moment for the markets this week.

Markets are weak across the board this morning…as of 6:05 am Pacific, Gold is off $16 an ounce at $1,627…Silver is 87 cents lower at $30.83…Copper is off 7 cents at $3.66…Crude Oil is $1.07 lower at $102.81 while the U.S. Dollar Index is up one-third of a point to 79.53…

Today’s Markets

Stock index futures in New York are down sharply as of 6:05 am Pacific with the Dow likely to open down more than 100 points…European stock markets are off between 1.7% and 2.7% as a result of PMI’s for Germany, France and the euro zone that signaled a much faster rate of contraction than had been expected (Germany’s manufacturing sector shrank at the fastest pace in nearly three years in April), dampening hopes the region will secure the growth needed to overcome the impact of planned government austerity measures…”Business confidence slumped lower and companies cut head counts at the fastest rate since early 2010 in order to reduce capacity to meet lower workloads,” said Chris Williamson, chief economist at data compiler Markit…

The weak economic numbers came as investors were adjusting to the strong showing by Socialist challenger Francois Hollande in the first round of France’s presidential election, and as a budget crisis in the Netherlands has brought down the government there…Dutch Prime Minister Mark Rutte will tender his government’s resignation today, clearing the way for elections…

The amount of money thrown at rescuing the world economy since 2008 is truly staggering, probably more than $14 trillion, and the financial spigots are still open…industrialized and emerging nations pledged another $430 billion to boost the International Monetary Fund’s lending power over the weekend, doubling the size of its crisis-fighting war chest in case Europe’s problems worsen and engulf more countries…three weeks earlier, European Union leaders set aside $1 trillion for Europe’s bailout fund in an effort to create a firewall to prevent the euro zone’s sovereign debt woes from spreading…

Major central banks are certainly not finished pumping money into the global economy…investors will be paying close attention as the Federal Reserve meets tomorrow and Wednesday while the Bank of Japan meets Friday…meanwhile, the IMF has recommended more action from the European Central Bank…

Chinese Manufacturers See Slight Pick-Up In April

Business conditions in China improved for manufacturers in April from levels seen in the previous month, although activity in the sector continued to decline according to data released by HSBC this morning…HSBC’s preliminary “flash” PMI rose to a two-month high of 49.1, compared with a final reading of 48.3 in march, as the the rate of output, new-order booking and employment all eased at a slower pace…it’s clear that earlier easing measures from Beijing have started to work, with more expected, which will likely enable the Chinese economy to achieve a “soft landing”…

Venture Exchange

The Venture Exchange has fallen for eight consecutive weeks and a bottom has got to be near at hand based on oversold chart conditions…the CMF(20) – Chaikin Money Flow Indicator – is very close to important lows set in December of last year, the fall of 2008 and at the climax of the early 2005 sell-off that sent the Index down 20% after a strong January and February…this could be “capitulation week” for the Venture before a reversal in May…

One of the most biggest mistakes investors make is selling out of panic into a market bottom…this is a time to be looking for opportunities, not dumping stocks overboard out of fear the sky is about to fall…

Kaminak Releases First Results For 2012 Drill Program

Kaminak Gold (KAM, TSX-V) has released results from the first 14 RC holes drilled this year at its Coffee Project in the Yukon…they included 3.6 g/t Au over 32 metres…2.1 g/t Au over 36.6 metres…2.1 g/t Au over 21.3 metres and 2.4 g/t Au over 18.3 metres…nothing spectacular but solid nonetheless for this project, and they include the discovery of a new oxide-rich Gold zone….Kaminak is drilling 50,000 metres this year (30 holes have been completed so far in the 2012 program) and a fourth rig is expected to be on the property by mid-May…an initial resource estimate is expected by early next year…

We’ve had some inquiries regarding Canaco Resources (CAN, TSX-V) which is expected to produce an initial resource estimate for its Handeni Project in Tanzania by the middle of next month…Canaco broke the $1 level March 23 and that’s approximately where it’s going to face immediate resistance…recently, it has been basing between 80 cents and 95 cents…the stock has been under intense selling pressure in recent months with the exception of February when it climbed as high as $1.85…the company has nearly 50 cents per share in cash (almost $100 million)…

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

Gold Stocks vs. Gold

Below is a chart going back to 2009 that shows how Gold stocks are now seriously under-performing bullion…a 32% drop in the TSX Gold Index since last summer has left Gold stocks in their most oversold position relative to the broad market since the Crash of 2008…CIBC commented last week on the extreme disparity between Gold stocks and the metal, saying the minor drop in bullion compared with the huge drop in Gold stocks suggests that “a massive oversold position for the equities has occurred in the last month”…this is an “unprecedented” period for Gold stocks, said CIBC…

TSX Venture Exchange and Gold

It was another rough week for the Venture Exchange which declined for the eighth consecutive week to 1398, a 62-point drop from the previous Friday.  The old adage, “Sell In May And Go Away”, could become “Buy In May And Stay” in 2012 as oversold conditions as well as strong support levels suggest the Index is very close to a bottom.  A turnaround or rally in May should be expected.  Below is an updated CDNX chart from John.

Gold

Gold lost $17 for the week to close at $1,659.  Silver was up 20 cents an ounce to $31.70.  Copper gained 8 pennies to $3.83.  Crude Oil jumped just over $1 a barrel to $102.83 while the U.S. Dollar Index fell three-quarters of a point to 79.14.

For what it’s worth, since late February, hedge funds, pension funds and other money managers have slashed by 39% their futures-market wagers that Gold will rise.  In the same period, they increased by 87% their bets that prices will fall.

However, according to the median estimate of the top five precious-metals analysts in Bloomberg Rankings in the past two years, the Gold price will average $1,900 an ounce in the fourth quarter, a 16% increase over the current price.  The analysts noted that central banks are joining investors in buying Gold, adding 439.7 tons in 2011, the most in almost five decades.  Citigroup and Deutsche Bank predict purchases of 400 tons and 500 tons, respectively, in 2012 by central banks.  Retail buying should continue as many individuals are worried about currency debasement.  With real interest rates essentially at zero, any rise in long-term bond yields would destroy capital.

John’s 1-year weekly Gold chart shows the yellow metal resting comfortably at the top end of a strong support band.

The TSX Gold Index hit a new 52-week closing low last week of 310.71, a whopping 32% drop from last summer’s record high.  That’s the biggest correction since a 25% haircut over a two- month period between early December, 2009, and February, 2010.  History shows that the best time to be a buyer of Gold stocks is during a major but normal and healthy pullback (approx. 25-30%) like we’re seeing now or like what occurred in 2006, 2007, 2009 and 2010.  Yes, a correction of this sort is almost an annual event.

CIBC commented last week on the extreme disparity between the current Gold price and Gold stocks by saying the minor drop in bullion compared with the huge drop in stocks suggests that “a massive oversold position for the equities has occurred in the last month”.  This is an “unprecedented” period for Gold stocks, said CIBC.

Silver

GFMS forecasts a high of just above $40 for Silver this year with a short-term trading range of between $28.70 to $32.90 an ounce in the second quarter. While its research shows that the Silver supply is growing, it is interesting to note that net government sales of Silver fell by a hefty 74% to a 14-year low of 11.5 million ounces, driven by a sharp decline in disposals from Russia.  In 2011, hedging in Silver amounted to about 10.7 million ounces or 334 tonnes of supply.  New hedging was dominated by companies for whom silver is a by-product.

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), money supply growth, 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 and Silver markets 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 and Silver 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. 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. 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.

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Gold is attempting to finish the week on a positive note…as of 6:00 am Pacific, the yellow metal is unchanged at $1,643…Silver is also flat at $31.80..Copper is up a nickel at $3.71…Crude Oil has gained $1.08 a barrel to $103.35 while the U.S. Dollar Index is off one-quarter of a point at 79.29…

China Opens Up More

China is poised to boost quotas on outbound investment schemes to $100 billion and cut barriers to moving foreign currency in and out of the country in a series of swift but small steps to crank open its tightly controlled capital account, according to a report from Reuters this morning…sources in close, direct contact with the People’s Bank of China (PBOC) and the China Securities Regulatory Commission (CSRC) say reforms are ready to be rushed out over the next 12 months to boost two-way capital flows, drive diversification of business finance and accelerate corporate currency hedging…Beijing took a milestone step in liberalizing its currency regime last week, doubling the daily onshore trading band for the yuan to 1 percent. The move underlined its desire for reforms designed to ease speculative pressures in the economy and re-balance capital flows, while taking the country one step closer to its goal of a basically convertible yuan by 2015…

IMF Euro Zone War Chest To Get A Boost

Major emerging powers stood ready today to pledge money to bolster the International Monetary Fund’s crisis-fighting war chest, though Brazil was holding out for promises that their voting power at the global lender would increase…Reuters is reporting this morning that, according to Russia, G20 advanced and emerging countries were ready at a meeting today to commit enough new funds to fulfill IMF chief Christine Lagarde’s request for at least $400-billion (U.S.) to draw a line under the euro zone crisis…

Today’s Markets

European markets are higher today as a rebound in bank shares offset losses in the tech and energy sectors…China’s Shanghai Composite Index was up by more than 1% overnight to close back above 2400 for the first time in over a month…

Stock index futures in New York are pointing toward a positive day on Wall Street…

Despite concerns in some quarters about a potential global economic slowdown, led in part by China, the resource-sensitive Canadian Dollar continues to hold up extremely well around par with the greenback…it’s currently in a horizontal channel after breaking down from an upsloping wedge about a month ago – whether that technical event holds any significance remains to be seen..it’ll be important to keep a close watch on the loonie over the next month or two for various overall stock market clues…

CDNX Long-Term Chart

Below is a 13-year monthly CDNX chart from John that shows the Index is now trading in a zone of major support…a strong rally from current levels is very possible – what will the catalyst be?…historically, in situations such as this, a strong move in the price of Gold or the announcement of a major discovery quickly reverses sentiment from bearish to bullish…the high degree of pessimism in the market at the moment is typically what one sees at important market bottoms…

Chart Update – Adventure Gold (AGE, TSX-V)

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

Chart Update – Probe Mines (PRB, TSX-V)

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

Gold is slightly weaker this morning…as of 5:20 am Pacific, the yellow metal is down $10 an ounce at $1,632…Silver is 24 cents lower at $31.39…Copper is off a penny at $3.65…Crude Oil is flat at $102.66 while the U.S. Dollar Index is up nearly one-fifth of a point at 79.76…

Today’s Markets

U.S. stock index futures as of 5:20 am Pacific are pointing to a higher open  after a better-than-expected Spanish bond auction lifted investor sentiment about peripheral Europe, and more solid earnings contributed to the notion that the American banking system is on the rise…Spain’s 2.5 billion euro ($3.3 billion) auction of 2- and 10-year sovereign bonds early in the European trading session met with solid demand…yields rose on the 10-year debt to 5.74%, but fell on the 2-year debt to 3.46%…

European markets are mixed while Asian markets were also mixed overnight…

More Stimulus In Brazil

Brazil’s central bank cut its benchmark interest rate to the lowest level in two years yesterday in an attempt to revive sluggish growth and restore the country to the ranks of fast-growing emerging markets…in its sixth consecutive cut, the bank’s monetary policy committee reduced Brazil’s Selic rate by 75 basis points to 9 %, in line with the majority of analysts’ estimates…after expanding at a China-like rate of 7.5 per cent in 2010, Brazil eked out growth of only 2.7 per cent last year, lower than any of the so-called Brics group or even some developed countries such as Germany…

Venture Exchange

The CDNX appears headed for its eighth consecutive weekly loss which only reinforces how oversold this market is…what we’ve seen since the beginning of March is certainly painful not unusual by historical standards, and there’s a strong probability that within a few months investors will look back at this period as an incredible buying opportunity…that’s hard for some to fathom at the moment but the situation now, in terms of bearish overall sentiment, is similar to that seen at or near the bottom of previous corrections…below is an updated CDNX chart from John with some hope that the end to this sharp pullback is in sight…the Index closed yesterday at 1412, 13 points off its December low…

Argex Mining (RGX, TSX-V)

Argex Mining (RGX, TSX-V), a specialty situation, has jumped as much as nearly 50% this month but showed signs of exhaustion yesterday after climbing as high as $1.25 and closing at $1.12…John’s chart shows RGX is probably in need of a rest for a period of time…

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

Roxgold (ROG, TSX-V)

Another solid performer on the Venture so far this year has been Roxgold (ROG, TSX-V) which is developing a number of large mineral concessions in Burkina Faso, West Africa...John’s 2-year weekly chart shows ROG has touched an important RSI(14) support level…the stock declined 8 cents yesterday to close at $1.56…

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

Gold, after a dip down and a move back up yesterday, is off $8 an ounce as of 4:45 am Pacific…Silver is 6 cents lower at $31.65…Copper is off a penny at $3.67…Crude Oil is down slightly at $104.08 while the U.S. Dollar Index is up one-quarter of a point at 79.80…

Thomson Reuters GFMS looks for Copper prices to remain constrained in the short term before improving in the second half of the year…Sanjay Saraf, research director for base metals at Thomson Reuters GFMS, outlined the consultancy’s outlook yesterday during the release of the Copper Survey 2012 in conjunction with CESCO Week in Santiago, Chile…

Crazy Things That Governments Do

As individual investors, one of the biggest risks we face is government…that was clearly in evidence again this week when Argentina decided to nationalize local oil company YPF, controlled by Spain’s Repsol, which apparently scuttled years of planning by China’s Sinopec Group to buy the South American company (the Argentinian government holds a 40% interest in YPF which is the original mistake)…anger mounted in Europe and Latin America yesterday at the nationalization…on a visit to Mexico, Mariano Rajoy, the Spanish Prime Minister, expressed “deep unease” with Argentina’s move and said it lacked “any justification or economic reason”…Mexican President Felipe Calderón, said it best when he called the nationalization “lamentable”…he added, “No one in their right mind is going to invest in a country that expropriates investments”…not surprisingly, shares in companies with interests in Argentina have been affected the last couple of days…Lumina (LCC, TSX-V), for example, has shed $1.29 or 7% the last two days…

Canadian Common Sense

On rare occasions a government will actually do something sensible when it comes to the resource industry…the Canadian federal government will limit the ability of environmental groups to intervene in reviews of major resource projects…Natural Resources Minister Joe Oliver said yesterday that Ottawa will soon table legislation that will reduce the number of projects that undergo federal environmental assessment by exempting smaller developments completely and by handing over many large ones to the provinces…the government, thankfully, will also bring in new measures to prevent project opponents from delaying the assessment process by flooding hearings with individuals who wish to speak against the development…

Today’s Markets

Asian markets were up sharply overnight with China’s Shanghai Composite gaining 46 points or nearly 2% to 2386…as John’s chart pointed out Monday, the Shanghai Index is looking bullish and a major breakout in the coming weeks seems very possible – it’ll be important to watch that market closely…

Shares are down in Europe this morning…minutes out of the Bank of England showed that only one Monetary Policy Committee member still supported quantitative easing , with ultra-dove Adam Posen giving up his long-standing call for more stimulus…also today, European Central Bank policymaker Jens Weidmann told Reuters that Spain should take care of its own debt woes and ruled out a third long-term financing operation (LTRO)—or injection of liquidity—from the ECB…

Stock index futures in New York as of 4:45 am Pacific are pointing to a mildly negative open on Wall Street…the Venture Exchange closed down 10 points to 1422 yesterday…for the year, the Index is now down 4% and has shown a trend very similar to 2005 when it rose significantly in January and February, and then plunged in March and April…from mid-May onward in 2005, however, the Venture was exceptionally strong and gained 40% by the end of the year…

Strike Graphite (SRK, TSX-V)

Graphite plays are performing well in this current environment – they have certainly been the “flavor”…an excellent example is Strike Graphite (SRK, TSX-V), which has a fabulous chart as John outlines below…as a result, we’re adding SRK to our “Watch List Group A”…SRK, which has approximately 42 million shares outstanding, gained 7.5 cents yesterday to close at 38.5 cents on volume of just over 1 million shares…

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

Rainbow Resources (RBW, TSX-V))

Encouraging technical signs are showing up in the chart for Rainbow Resources (RBW, TSX-V) which reversed intra-day yesterday to close at 20 cents…an insider buying trend is beginning to emerge, with CEO Brian Murray and director Jim Decker adding to their positions just recently…John’s 4-month daily chart below shows a potential reversal in momentum given the positioning of the RSI(14) and Slow Stochastics…

Note: John and Jon both hold positions in RBW (Terry does not).

Spanish Mountain (SPA, TSX-V)

Spanish Mountain (SPA, TSX-V), like many stocks, has taken quite a beating in recent weeks but the chart is now clearly giving encouraging signs and that may also be an indication that this decline in the Venture could be drawing to a close…SPA is developing a world-class asset with its Spanish Mountain Gold Project in central British Columbia, and current infill drilling is expanding the resource…SPA is down about 40% for the year but appears to have found strong support in the low-to-mid-40’s…

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

Gold has hovered between $1,645 and $1,658 so far today…as of 6:00 am Pacific, the yellow metal is unchanged at $1,653…Silver is 16 cents higher at $31.69…Crude Oil has gained $1.07 a barrel to $104.00…Copper is flat at $3.66 while the U.S. Dollar Index is off slightly at 79.50…

U.S. Housing Data

Groundbreaking on U.S. homes fell unexpectedly in March, but permits for future construction rose to their highest level in 3 1/2 years according to data released within the last half hour by the Commerce Department…

Bank of Canada Boosts Growth Forecast, Hints of Rate Increase

The Bank of Canada left its main interest rate untouched at 1% this morning while painting a brighter economic outlook and hinting for the first time since last summer that it is beginning to look for an opportunity to raise borrowing costs…today’s statement was vague about timing, saying only that it may become necessary to increase rates, but that this would depend on “domestic and global economic developments”…Mark Carney has boosted his 2012 growth forecast for Canada by four-tenths of a percentage point to 2.4% though he cut his 2013 forecast by the same amount to 2.4%…”The external headwinds facing Canada have abated somewhat, with the U.S. recovery more resilient and financial conditions more supportive than previously anticipated,” Carney stated…

India Cuts Rates To Boost Growth

Central banks around the world have introduced well over 100 stimulus measures since December with India being the latest example this morning…key lending rates there were cut for the first time in three years today in an aggressive effort to boost growth and investment at a time when the gloss is rapidly coming off Asia’s third largest economy….the Reserve Bank of India cut the repo rate – the rate at which the central bank lends to commercial banks – by 50 basis points to 8%…the more than expected reduction was widely welcomed by business…having increased rates 13 times since March, 2010, the RBI’s move reflects a shift in the bank’s policy from focusing exclusively on reining in inflation, which at 7% remains high, to reviving the country’s slowing economy…growth in the last quarter of 2011 in India was the slowest in almost three years, rising 6.1%, compared with more than 8% a year earlier…meanwhile, inflation has eased persistently over the past year…China, Brazil and Indonesia are also relaxing monetary policies in order to boost growth – all of this is positive for Gold and commodities in general…

Troubles In Spain

Another round of heavy bond-buying by the ECB, which would be bullish for Gold, is quite possible given the situation in Spain at the moment as Spanish 10-year bond yields moved above 6% yesterday while credit default swaps rose to record highs…the need for international investment in Spain’s government debt – not just buying by its domestic banks – has now become more pressing…the Financial Times reported this morning that strategists believe Spanish banks have used up much of the extra money for buying sovereign debt that was borrowed at low rates from the European Central Bank under its longer-term refinancing operations…

CRB Index and Copper

There is a close correlation between the TSX Venture Exchange and the CRB Index and the Copper market, so two charts by John this morning provide us with some valuable insight…below is a 10-year weekly chart of the CRB Index which at 301 is in a zone of very strong historical support – similar in that respect to the Venture…RSI and Slow Stochastics are each in a position to support a move up – perhaps not immediately but as the second quarter continues…

Copper

Below is a 6-month daily chart for Copper which shows a very oversold market trading at a strong support area…it’s hard to imagine Copper declining much more given the state of this chart…

Today’s Markets

European markets are up significantly this morning, around 1%, while stock index futures in New York are pointing toward a positive open on Wall Street…the Venture Exchange fell 27 points yesterday to 1432 – the first sign of a turnaround will come when the Index can get above its declining 10-day moving average (SMA) which has served as resistance since the breakdown in early March…

Armistice Resources (AZ, TSX-V)

Below is an update on Armistice Resources (AZ, TSX-V) which has managed to hold support and may have turned the corner – exactly what we want the see the Venture do…

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