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From Nelson, B.C.

Gold has traded between $1,565 and $1,575 so far today…as of 6:05 am Pacific, the yellow metal is unchanged at $1,573…Silver is 12 cents lower at $26.78…Copper is off a penny at $3.32…Crude Oil is down $1.08 to 78.68 while the U.S. Dollar Index is up one-tenth of a point to 82.48…

This is an abbreviated edition of Morning Musings due to severe time constraints, Internet issues and travel logistics as most of our last two days have been spent on the ground at a Rainbow Resources‘ (RBW, TSX-V) site visit over the weekend which included the company’s flagship International Silver Property a few hours’ drive to the north of where we are now – the historic mining town of Nelson…we are extending our visit by an additional day to check out more of the area around Nelson including the flake graphite situation…we have accumulated a large amount of information which we’ll be putting together and sharing over the coming days…

Rainbow has made a great deal of its International Property since the company acquired this project when it took over privately-held Braveheart Resources last fall, but the International exceeded even our own expectations given its scope and widespread mineralization – some of which (in massive galena) is eye-popping…access through the property, which ranges in elevation from about 600 metres to 2100 metres, is also more than adequate to support substantial drilling…historically, access issues have prevented this project from ever reaching the drilling stage…it has to be one of the best un-drilled properties in all of British Columbia, and truly holds excellent potential for a Silver discovery…RBW is now gearing up for drilling, which is imminent, and the International is where its summer drill program will commence…the first holes will be drilled right into the heart of an impressive wall of mineralization as we showed in some pictures posted last night…

We’ll have more tomorrow from our visit…

In the meantime, John has chart updates this morning on Gold and the CRB Index…

Gold

CRB Index

Gold is attempting to get back on track after yesterday’s sell-off but the bulls are on the defensive…as of 6:25 am Pacific, bullion is up $2 an ounce at $1,567…Silver is 4 cents lower at $26.84, just above its May low…Copper is up a penny at $3.32…Crude Oil has gained 47 cents to $78.67 while the U.S. Dollar Index is off slightly at 82.22…

For some encouragement regarding Gold, in 8 out of the last 9 years the July to December period has been bullish for the yellow metal as John points out in the chart below…

Crude Oil

Markets across the board threw a temper tantrum yesterday over a range of issues…U.S. crude oil prices tumbled below $80 to their lowest level since last October…weak manufacturing data from China and the U.S. reminded market watchers that the global economy remains sluggish and ratcheted up fears it may slow further…continued weak oil prices, however, will ultimately help consumers and businesses and have a “stimulus” effect on the global economy…

Crude prices have fallen 30% from their March highs but it’s not just a demand issue…oil production globally rose to a record level in May, according to the International Energy Agency…the world is now pumping 91.1 million barrels per day, the most ever, with OPEC production, at more than 31.5 million barrels in May, also higher than normal…growth in oil production from Iraq and even the United States has been significant…the total supply increase may also have a lot to do with Iran which was threatening to close the Strait of Hormuz just a few months ago…Iran is getting hit hard by lower oil prices, a fact that may soften them up at the negotiating table with regard to their nuclear ambitions…

Banks Downgraded by Moody’s – Reaction Overdone?

Contributing to yesterday’s market sell-off was word of an imminent downgrade to the credit ratings of 15 of the world’s biggest banks (Moody’s came out with its downgrades after the closing bell) which caused panic among some investors and pundits, but why?…this was certainly not an unexpected development…Moody’s had flagged in February that it was considering a mass downgrade of the banks, and how much credibility does this ratings agency have in the first place?…as one market observer pointed out yesterday, “If Moody’s designed a car, you’d have the driver’s seat facing backwards”…five U.S. banks were downgraded, one Canadian (Royal Bank) and nine European banks…does anyone believe the Royal Bank of Canada is not as solid as a rock?…RBC has long taken issue with being called out for its capital markets exposure…it argued in early June that its trading inventory has been cut to $118-billion from $151-billion in the third quarter of 2011, and noted that its fixed-income balance has shrunk by 15% since last year…RBC also said profits from its retail operations vastly outweigh those from capital markets…

Stress tests conducted by the Federal Reserve at the beginning of this year year showed that the majority of the largest U.S. banks will continue to have enough capital to satisfy the regulators, even if they suffer a financial shock that includes unemployment hitting 13% and a 21% drop in housing prices…

“This is one of the most absurd things that Moody’s has ever done perhaps in the history of the company,” said Dick Bove, Vice President of Equity Research in the Financial Sector at Connecticut-based Rochdale Securities…the fundamentals of the American banking industry point to balance sheets that have improved “dramatically” over the last 4 years, Bove told CNBC…the equity-to-assets ratio is as high as it was in 1938, liquidity as a percentage of assets is at a 30-year high, and reserves against bad loans are up while bad loans are down, Bove said…

“In any metric that you look at…the banks have shown improvement in earnings in every one of the past 11 quarters year-over-year…if you go into the bond market, where Moody’s did the downgrade, prices of bank bonds are going up…not only are they going up, they are going up faster than the prices of Treasurys, so what in heavens’ name is Moody’s doing?,” Bove said…

Today’s Markets

Stock index futures as of 6:25 am Pacific are pointing toward a higher open on Wall Street as markets try to finish the week on a positive note and make up for lost ground yesterday…(the ECB is taking some measures this morning in reports just hitting the wire)…the Venture Exchange hit a new 52-week low of 1211 but rebounded slightly near the end of the trading session to finish at 1217, 2 points above its May 16 intra-day low…there’s a strong support zone between approximately 1150 and current levels…is the Venture putting in a double bottom?….we’ll see what happens today…John will have an updated Venture chart as part of our Week In Review and A Look Ahead which will be posted Sunday following our site visit tomorrow to Rainbow Resources‘ (RBW, TSX-V) International Silver Property…

Eagle Hill Exploration (EAG, TSX-V)

One of the bright spots in the market yesterday was Eagle Hill Exploration (EAG, TSX-V) which intersected 11.8 g/t Au over 47.2 metres near-surface at its Windfall Lake Gold Deposit in northwestern Quebec – a 25-metre step-out to the east of a hole drilled earlier this year which returned 22.85 g/t Au over 25 metres… below is an updated chart on EAG after it climbed 3 cents to close at 16 cents on total volume (all exchanges) of 3.6 million shares…

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

Gold has bounced around again today between a high of $1,606 and a low of $1,582 an ounce on a day of general commodity weakness…as of 6:05 am Pacific, the yellow metal is down $19 an ounce at $1,588…Silver is off 48 cents at $27.64…Copper is 4 cents lower at $3.35…Crude Oil has declined another 94 cents to $80.51 while the U.S. Dollar Index is up one-fifth of a point at 81.73…

Spain’s borrowing costs hit a new euro era high at a debt auction this morning, a few hours before it’s expected to shed light on the dire state of its weaker banks and possibly make a formal request for European Union funds to rescue them…

The number of Americans filing new claims for unemployment benefits was little changed last week, according to government data this morning that suggested the labor market was struggling to regain momentum…the four-week moving average for new claims, considered a better measure of labor market trends, increased 3,500 to 386,250 – the highest level since early December…

China’s factory sector contracted for an eighth straight month in June, with export orders and prices turning in their weakest showing since early 2009, a private-sector survey showed this morning…Chinese consumers, however, are still in strong shape…Some 15% of 20,000 households recently polled plan to buy a vehicle in the next three months, the highest since that survey began in 1999…

The Federal Reserve acted as expected yesterday, extending Operation Twist through the remainder of the year and confirming that the fed funds rate will remain near zero through 2014…Chairman Ben Bernanke said the Fed is ready to act more aggressively if necessary, meaning he has kept some power dry in the event the euro zone crisis deepens or U.S economic activity in the weeks and months ahead is weaker than expected due to global and domestic influences…

Today’s Markets

Japan’s Nikkei average broke above 8,800 for the first time in five weeks today…European shares are mixed this morning while stock index futures in New York as of 6:05 am Pacific are pointing toward a flat open…

TSX Gold Index

John has an interesting 10-year chart this morning that compares the TSX Gold Index with the price of Gold…as you can see below, the plunge in the TSX Gold Index to a low of 266 May 16 was indeed historic…only during one other period – late 2008 – have Gold equities been so oversold relative to the price of Gold, and 2008 of course represented an incredible buying opportunity…the Gold Index has out-performed the metal significantly over the past 5 weeks, gaining 22%…given historical patterns, we believe what the Gold stocks are telling us at the moment is that the Gold market remains healthy and the long-term trend is still bullish…

Lumina Copper (LCC, TSX-V)

Lumina Copper (LCC, TSX-V), a potential takeover candidate with its world class Cu-Au-Mo deposit in northwestern Argentina, has climbed 40% over the past week since a yearly low of $7.26 intra-day last Thursday…LCC closed yesterday at $10.20…notice in John’s updated chart how LCC has broken above a downtrend line…not surprisingly, there has also been a significant change in buying pressure…expect considerable near-term technical resistance between approximately $11 and $12 but this doesn’t take into account Lumina’s strong fundamentals and a potential takeover…

Northern Graphite (NGC, TSX-V)

Northern Graphite’s (NGC, TSX) 20-day moving average (SMA) is now rising for the first time since April with the stock finding support near its 200-day SMA…both volume and buying pressure need to increase, however, for NGC to push through resistance at $1.80…

Note: John, Jon and Terry do not hold positions in LCC or NGC.

Gold is weaker this morning in advance of today’s important Fed decision…as of 5:35 am Pacific, the yellow metal is down $14 an ounce at $1,604…Silver is 28 cents lower at $28.14…Copper is 2 pennies lower at $3.42…Crude Oil is up 12 cents at 84.15 while the U.S. Dollar Index is off one-fifth of a point at 81.28…

What Will The Fed Do Today?

The consensus among market watchers is that the Fed will extend Operation Twist which is set to expire at the end of this month…the equity and precious metals markets recently have been factoring in some sort of action from the Fed today, so any inaction – mere words – will produce a negative immediate response from the markets…in terms of the potential for another full-blown QE program, this seems unlikely at this particular time – Bernanke will likely want to keep his powder dry in the event circumstances in the euro zone take a turn for the worse over the summer…

Europe won support from world leaders yesterday for an ambitious but slow-moving overhaul of the euro zone, even as pressure built in financial markets for quicker solutions to its debt crisis that threatens the world economy…two key policymaker meetings are set for Friday…euro zone officials need to turn words into action and clearly demonstrate to the market that progress is being made in key areas such as a banking union, the fiscal pact, and regulation…

Today’s Markets

Asian markets were generally positive overnight while European shares are mostly in the green so far today…stock index futures in New York as of 5:40 am Pacific are pointing toward a slightly positive open on Wall Street…

Euro Chart

The euro has been gaining momentum recently which is both Gold and stock market-positive…the euro has broken above a resistance band (it’s currently trading at 1.271) but confirmation is required today…there’s more resistance just above 128…the major euro breakdown in May produced very oversold conditions and corresponded with the lows (which will hopefully hold) in the equity markets…

Lumina Copper (LCC, TSX-V) And Cascadero Copper (CCD, TSX-V)

We suggest readers carefully review recent news releases from both Lumina Copper (LCC, TSX-V) and Cascadero Copper (CCD, TSX-V)…Lumina, of course, has shot up quite nicely as we suspected it would after its news last Friday (the company has put itself on the auction block and, reading between the lines, has no doubt received some “expressions of interest”)…Lumina holds the world class Taca Taca Cu-Au-Mo deposit in northwestern Argentina, part of which adjoins ground held by Cascadero’s 50%-owned Argentine subsidiary…

What’s particularly interesting – and we don’t believe the market has caught on to this yet – is that two very good and important drill holes that Lumina reported June 6 250 metres northwest of its current 43-101 mineral resource appear to be very close – perhaps even a stone’s throw – from Cascadero’s Francisco II Property (Argentine subsidiary)…RC-19 intersected 222 m of 0.83% CuEq while RC-23 delivered 152 m of 0.83% CuEq…this new discovery zone, which includes high-grade supergene copper mineralization, has so far been defined over an area of 600 m east-west and 600 m north-south very close to the Francisco II boundary…

Now, as we continue to “connect the dots”, below are direct quotes from Cascadero’s June 15 news release:

“The Francisco II property adjoins Taca Taca immediately to its west and is primarily pediment covered with few outcrops…the MMI sampling was focused on this area as it is close to recent Lumina drill holes and to the common property boundary…this area is also important as it may be on a northwestern-trending channel that may have transported exotic copper from the Taca Taca deposit to the graben during the leaching process…

“The company believes that Taca Taca porphyry-related mineralization may exist to the west and northwest of Lumina Copper’s and Salta’s property boundaries…in addition, historical sampling and alteration evidence suggests that the Salta properties have high potential for stand-alone porphyry Cu-Mo-Au, exotic copper, epithermal-style Gold and IOCG (iron oxide, copper, Gold) mineralization”…

The “big picture” significance of the above is that Cascadero’s Francisco II Property could be an extension of the Taca Taca system and therefore may figure prominently in Lumina’s plans at the moment or those of another company that may wish to acquire Lumina…Cascadero closed yesterday at 14 cents…

Argex Mining (RGX, TSX-V) Chart Update

Last Friday, John pointed out some very bullish patterns in the chart for Argex Mining (RGX, TSX-V) which then proceeded to climb 13 cents Monday and another 11 cents yesterday on strong volume for a gain of 33% over just two trading sessions…below is an updated chart after yesterday’s activity, showing how the stock sliced through resistance in the mid-80’s – an area that now becomes new support…RGX closed at 97 cents yesterday…

Cap-Ex Ventures (CEV, TSX-V)

CEV continues to work on a world class iron ore project in western Labrador, though the stock has shown its vulnerability over the last few months to the risks of a global economic slowdown…below is an updated chart for CEV which closed up a nickel yesterday at 45 cents after touching a yearly low of 38.5 cents last week…

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

Gold has traded between $1,627 and $1,635 so far today…as of 4:30 am Pacific, the yellow metal is up $2 an ounce at $1,630…Silver is up 8 cents at $28.82…Copper is flat at $3.40…Crude Oil is off 18 cents at $83.09 while the U.S. Dollar Index is down slightly at 81.74…

Today’s Markets

Asian markets weakened slightly overnight with Japan’s Nikkei retreating from the 1-month high it hit Monday as the initially positive reception for a pro-bailout party victory in Greece was dampened by concerns about Spain’s banking sector and fiscal health…European shares, however, are modestly higher this morning while U.S. stock index futures as of 4:30 am Pacific are pointing toward a slightly positive open on Wall Street…

All Eyes On Bernanke And The Fed – Goldman Sachs Predicts New Easing Measures

Goldman Sachs believes the U.S. central bank will most likely decide to ease monetary policy after it meets today and tomorrow as recent data point to a worsening labor market while the euro zone debt crisis continues…according to a report by Jan Hatzius, the investment bank’s chief U.S. economist, the FMOC will likely say it would buy assets such as mortgage-backed securities and U.S. Treasurys…the Federal Reserve may also extend Operation Twist, he added, although he does not find the “strategy very attractive”…the program – which involves the Fed selling medium-term bonds and using the proceeds to buy longer-term ones, such as 10-year Treasurys, effectively driving down longer-term interest rates – runs out at the end of this month…“We believe that an extension of Operation Twist could well be insufficient on its own and could thus be followed by additional easing action before long,” Hatzius said…“We would be quite surprised if we saw no easing this week,” Hatzius wrote in the report…

G-20 To “Take All Necessary Policy Measures” To Safeguard The Euro

The euro zone members of the Group of 20 leading economies will pledge today to “take all necessary policy measures” to safeguard the single currency, according to leaked drafts of the summit communiqué obtained by the Financial Times…in a statement that will paper over the considerable differences in policy positions within the euro zone and among other G20 countries, the Group has agreed to take action to generate growth and restore confidence “based on country-specific circumstances”…

According to the Financial Times, the G20 will state:  “The euro area member states at the G20 will take all necessary policy measures to safeguard the integrity and stability of the euro area, including the functioning of financial markets and breaking the feedback loop between sovereigns and banks”…

VIX Breaks Down

John’s technical call on the VIX (Volatility Index) last month proved to be bang-on as it topped out in the upper-20’s and then formed a head-and-shoulders pattern…it finished at 19 yesterday, breaking below support at the neckline, and is likely headed lower with a target of 15…this bodes well for the equity markets, at least for the near-term…

TSX Gold Index

The TSX Gold Index continues to look very strong (it closed up 7 points yesterday at 329 on strong volume) which suggests Gold has a good chance of pushing higher in the days ahead…

The Venture Exchange is not leading the Gold Index at this point, which is what we’d like to see happen, but the Venture is nonetheless following behind and trying to keep up…the Venture gained 9 points yesterday to close at 1260…an easing move by the Fed tomorrow would likely ignite a rally and propel the Index through the 1300 level…

Rainbow Resources (RBW, TSX-V)

It appears Rainbow’s drilling plan for the International Silver Property has been accepted by the B.C. Ministry of Mines as Rainbow disclosed on its web site last night that it has posted a reclamation bond for the International with drilling “imminent”…this is very encouraging news and suggests RBW’s Big Strike drill program will commence at the flagship International as opposed to the Gold Viking Property…multiple shallow holes to depths of approximately 100 metres are expected to be drilled at the International into an exposed vein structure with the exploration target being high-grade Silver…this is a property with a strong chance of a drilling discovery…it has never been previously drilled due to access issues which have been resolved in recent years…Rainbow will be drilling directly into a “honey zone” – known structures containing weak to massive galena, pyrite and rare sphalerite…the International vein system was surveyed  by the B.C. government over a minimum true strike length of 1.2 kilometres in the early 1900’s following an important Silver discovery…reported grades from artisanal mining have been spectacular along with sampling results from Rainbow and privately-held Braveheart Resources which began work there in 2006…several technical reports have already been produced on the property…the International is one of the most prospective un-drilled properties in British Columbia and we’re looking forward to a site visit this coming Saturday…

Argex Mining (RGX, TSX-V)

John’s chart last Friday on Argex Mining (RGX, TSX-V) showed a bullish trend, and indeed the stock took off yesterday as it broke out of a six-week horizontal channel and jumped 13 cents on strong volume…

Another Takeover

Yamana Gold (YRI, TSX) has entered into a definitive agreement with Extorre Gold Mines Ltd. (XG, TSX) whereby Yamana will acquire all of the issued and outstanding common shares of Extorre for $3.50 in cash and 0.467 of a Yamana common share…Extorre jumped nearly 70% yesterday on the news…its most advanced project is Cerro Moro, a high-grade, Gold-Silver deposit with approximately 1.36 million ounces of Gold equivalent indicated mineral resources and 1.05 million ounces of Gold equivalent inferred mineral resources, located in the province of Santa Cruz in Argentina…

Lumina Copper (LCC, TSX-V) could be next in line in Argentina to be taken out…it climbed another 29 cents yesterday to $9.19…

Welcome to our site, or at least the initial version of it!  BMR has been online for nearly three 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 a great deal 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,

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Owner/Publisher, www.BullMarketRun.com

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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 down for the first time in 7 sessions following yesterday’s vote in Greece with the pro-bailout parties winning…as of 5:30 am Pacific, the yellow metal is off $8 an ounce at $1,619 but up from a low of $1,606…Silver is 40 cents lower at $28.34…Crude Oil erased early gains and is now down $1.11 at $82.92 while the U.S. Dollar Index has jumped nearly half a point to 81.83…

Today’s Markets

Asian markets were up significantly overnight with the Nikkei gaining 152 points or 1.8%…European shares are off their highs but still generally mostly in the green on the Greek election results but investors’ moods have been tempered with the fact that borrowing costs have risen today for both Spain and Italy…the yield on Spain’s 10-year bond went above the 7% “danger” level…stock index futures in New York are down modestly as of 6:00 am Pacific, reversing last night’s early gains…

While markets seem relieved that the radical, far-left SYRIZA party has not gained control in Greece, the fact remains that the New Democracy and Pasok parties who are expected to form a majority coalition were also responsible for the economic mismanagement and patronage system that brought Greece to its knees…in addition, SYRIZA vows to continue its opposition to painful austerity measures which has the potential of stirring up more social as well as political unrest in Greece…the bottom line is that the euro zone is only as strong as its weakest link which is why Greece, an economic and political basket case, needs to be given the boot…Greece, however, is just part of the problem and a bold, broad strategy to effectively deal with the euro zone crisis is urgently needed…

Elsewhere in Europe, French President Francois Hollande’s Socialists won an absolute parliamentary majority yesterday, strengthening his hand as he presses Germany to support debt-laden euro zone states hit by austerity cuts and ailing banks…what did Margaret Thatcher so famously say about socialism?…”The problem with socialism is that eventually you run out of other people’s money”…

India Holds Rates

India’s central bank left interest rates and the cash reserve ratio for banks unchanged today, defying widespread expectations for a rate cut as it warned that doing so could worsen inflation, disappointing markets…”Further reduction in the policy interest rate at this juncture, rather than supporting growth, could exacerbate inflationary pressures,” the RBI (Reserve Bank of India) wrote in its mid-quarter policy review…

Goldman Sachs Has Bullish 12-Month Outlook For Commodities

In case you missed it, Goldman Sachs last week recommended “stepping back into the markets” in its latest Commodity Watch…Goldman is anticipating a 29% return for the S&P GSCI Enhanced Commodity Index over the next 12 months and suggests investors might want to increase their position in commodities…crude, gas, copper, aluminum and Gold are the bank’s top picks…Goldman envisions a soft landing for China’s economy as well as accommodative action from global policymakers…

Below is an interesting graph from a report at www.usfunds.com that details global fund managers’ net allocation to commodities…many institutional managers have exited the commodities superhighway in favor of cash – currently at the third highest level on record – or technology stocks…in its global fund manager survey this month, Bank of America-Merrill Lynch found that advisers’ allocation to commodities reached its lowest level since February, 2009 – a great time to load up on commodity-related investments…

TSX Gold Index

The TSX Gold Index has been a reliable indicator of the direction of Gold prices over the last several weeks, and the chart suggests another bullish move to test resistance at 340 appears to be on the way…the May 16 low of 266 was an important bottom with the Index climbing 21% since then…John’s updated chart shows a very well-defined bottom with superb support at 300 and higher…

Lumina Copper (LCC, TSX-V)

Lumina Copper (LCC, TSX-V) jumped $1.07 Friday to $8.90 after announcing, essentially, that it could be close to concluding a deal for the sale of the company…its board of directors “has initiated a strategic review process to consider a range of strategic alternatives that have presented themselves to the company, with a view to enhancing shareholder value…strategic alternatives may include, but are not limited to, the sale of all or a portion of the company’s assets, the outright sale of the company, a merger or other business combination transaction involving a third party, a joint venture, as well as continued execution of the company’s existing business plan, or any combination thereof”…

It’s not surprising there appears to be considerable interest in Lumina’s Taca Taca copper-gold-molybdenum project in northwest Argentina…On May 7, Lumina released updated inferred and indicated resources at Taca Taca that total 1,762-million tonnes grading 0.53 per cent copper, 0.016 per cent molybdenum and 0.099 g/t Au…this equates to (approximately) 20.5 billion pounds of copper, 5.5 million ounces of Gold and 603 million pounds of molybdenum at a 0.40-per-cent copper equivalent cut-off (the gross metal value is nearly $80 billion)..the sulphide mineral resource remains open to the northwest, north, northeast, southeast, south and to depth while the oxide Gold mineral resource remains open to the east…

There’s no question Taca Taca is a world-class Cu-Au-Mo porphyry system with tonnage and grade in the top quartile of undeveloped global porphyry systems…Lumina hit an all-time high is $17.96 at the end of March while it appeared to bottom out last Thursday at an intra-day low of $7.26, just below its rising 500-day moving average (SMA)…the 200-day SMA is still increasing and currently sits just under $12…the current market cap is only $364 million based on 40.9 million shares outstanding…

Below is a Lumina chart from John that shows a confirmed hammer reversal supported by strong volume and buying pressure, so the potential for more upside clearly exists from a technical standpoint – throw in some fundamental factors like a potential takeover and this appears to be a low-risk opportunity at current levels…

Another “play” on Lumina may exist with Cascadero Copper Corporation (CCD, TSX-V) which we highlighted a few months ago…interestingly, CCD came out with news Friday on the same day as Lumina, and climbed 2.5 cents to 16 cents on its highest volume (392,000 shares) since 2010…reading between the lines, there could be discussions between these two companies as Cascadero has property adjoining Taca Taca…in fact, CCD’s 50% owned Argentine subsidiary has just completed a program of mobile metal ion (MMI) and outcrop rock grab samples in an area adjoining Taca Taca…elsewhere in the region, Cascadero recently completed five drill holes at its Pancho Arias Cu-Au-Mo prospect…assays are pending but the company reported intersecting variable Mo mineralization from surface in all five holes and variable chalcopyrite mineralization form surface in four of the holes…all holes ended in mineralization…the Pancho Arias mineralized zone outcrops over a large area…

Great Panther Silver (GPR, TSX)

One of our favorite Silver plays for the long-term is Great Panther Silver (GPR, TSX) which has traded in a fairly tight range over the last 9 months between strong support around $1.75 and significant resistance just below $3…the stock’s technicals have improved recently and a reversal to the upside in GPR’s 50-day SMA is just underway…GPR closed Friday up 11 cents at $2.15, and the near-term technical outlook shows opportunity based on John’s chart below…

Note: John, Jon and Terry do not hold positions in LCC, GPR or CCD…