BullMarketRun.com

Welcome to our site, or at least the initial version of it!  BMR has been online for more than 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,

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 was as high as $1,617 overnight but has gently pulled back…as of 6:45 am Pacific, bullion is down $7 an ounce at $1,608…Silver has retreated 44 cents to $28.74…Copper is up 2 pennies to $3.45…Crude Oil has gained 69 cents to $93.14 while the U.S. Dollar Index has fallen nearly one-fifth of a point to 82.63…

Crucial 72 Hours For Cyprus

Pressure is mounting on Cyprus…the country’s lawmakers are gearing up to vote on a series of bills put forward in a renewed effort to strike a bailout deal with European partners after talks with Russia collapsed…the country announced plans yesterday Thursday to overhaul its banking industry and force losses on big depositors as the European Central Bank threatened to withdraw crucial funding if the island’s government failed to agree on a bailout by Monday…the proposals, if they take effect, would allow authorities to restrict non-cash transactions, curtail check cashing, limit withdrawals and even convert checking accounts into fixed-term deposits when banks reopen…they have been closed since March 16…Cyprus has been promised $13 billion in aid from the euro zone if it can come up with $7.5 billion on its own, but that could be easier said than done as lawmakers debate about who should pay to dig the country out of its financial hole…for the first time in the euro’s 14-year history, citizens of a country that use the currency are facing an extended period blocked off from their money – an unsettling image for depositors around Europe…stock markets, however, are showing impressive resilience – up to this point at least…

Barclays – Any Equity Correction To Be Contained, Base Metal Outlook Weak

“The main risk is that equity markets have come too far too fast and that investor sentiment may have become too optimistic,” Barclays Capital stated in a research note according to an article in the Financial Times this morning…“However, we expect any correction to be contained given persistent fundamental support for equities: continued policy support, the low risk of a cyclical downturn and attractive valuations relative to fixed income”…Barclays also stated that any rallies in base metals are likely to be unsustainable and are selling opportunities as fundamentals are weak…Global supplies are ample, as seen in growing inventories, and forward prices are in contango, the firm said, meaning that nearby prices are lower than deferred prices…“Copper supply has been outperforming our expectations, while a lack of production discipline in nickel and aluminum is keeping those markets heavily oversupplied,” Barclays said…

Copper vs. S&P 500

We’re not quite sure what to make of this, but the current divergence between Copper and the broad equity markets is a concern – especially when one considers the fact that Copper is viewed as a reliable leading indicator of the overall health of the global economy…it also led the equity markets higher out of the 2008 Crash and that out-performance continued until early last year…below is a multi-year monthly chart from John that shows how pronounced the divergence is that started at the beginning of this year…

Today’s Markets

Asian markets were mostly lower overnight, though China’s Shanghai Composite bucked the trend with a slight gain to close at 2,328…after a powerful 25% rally from 1950 to nearly 2450 between early December and early February, the Shanghai corrected 200 points or 8% to unwind overbought conditions…Japan’s Nikkei average lost 297 points or 2.3% overnight to close at 12339…European shares are flat…the influential Ifo survey on German business confidence came in lower than expected…it declined to 106.7 in March from 107.4 in February…the slump was the first decline in five months and was below economists’ forecasts of 107.6…meanwhile, investors are keeping an eye on Italy where an imminent decision is expected from President Giorgio Napolitano  on the next steps toward  forming a new Italian government following two days of consultations with the country’s main political leaders…Beppe Grillo, head of the radical “Five Star Movement” which won 25% of the vote in February’s elections, asked Napolitano to give his party a mandate to govern…in North America, the Dow is up 51 points to 14472 through the first 15 minutes of trading…the TSX has gained 23 points while the Venture is off 2 points at 1101…

TSX Gold Index Updated Chart

The TSX Gold Index continues to slowly recover out of oversold conditions not seen since the 2008 Crash…while it still has a lot of overhead resistance to battle through, it’s possible the Index may have found a bottom recently (March 6) at 243…it climbed 6 points yesterday to close at 260, its highest level in 17 sessions…below is a 2-year weekly chart from John…important near-term resistance is between 270 and 280…as of 6:45 am Pacific, the Gold Index is down a point at 259…

Those Red-Hot Lumber Plays…

Lumber has been a red-hot commodity, especially since last year when a recovery in the U.S. housing market really started to take hold…this has translated into major gains in many forestry stocks…a “super-cycle” could be developing in lumber with the peak still two or three years away given tight supplies and strong demand…U.S. housing starts are expected to more than triple off their 2009 lows between now and 2017 when some analysts say they will hit 1.5 million starts a year…starts are expected to reach 925,000 to 950,000 this year…

Below are “awareness” charts from John on Canfor Corp. (CFP, TSX) and Ainsworth Lumber (ANS, TSX) that demonstrate how technically overbought this sector currently is on a short-term basis…an attractive buying opportunity may emerge during the second quarter on an expected pullback to unwind these overbought conditions…this could easily be followed by new highs later in the year…

Canfor Corp. (CFP, TSX)

Ainsworth Lumber (ANS, TSX)

Note: John, Jon and Terry do not hold share positions in CFP or ANS.

Gold continues to show strength by staying above the $1,600 level…as of 7:10 am Pacific, bullion is up $9 an ounce at $1,616 after touching a high of nearly $1,619 (resistance at $1,620)…Silver has jumped 46 cents to $29.28…Copper is off a penny at $3.43…Crude Oil, at $92.91, has lost 59 cents while the U.S. Dollar Index is up one-tenth of a point to 82.92…

Today’s Markets

Asian markets were mixed overnight but Japan and China both showed strength…the Nikkei average hit a new 4.5-year high, climbing 167 points or 1.3% to close at 12636…the Shanghai Composite, meanwhile, edged 7 points higher to finish at 2324…after a mild correction, the Shanghai is now at a one-month high…signs of growth have returned to China’s manufacturing sector after the latest HSBC Flash PMI rose to 51.7 for the month of March, recovering from February’s weaker holiday-impacted reading…sentiment was also lifted after the Federal Reserve reaffirmed its commitment yesterday to leave interest rates unchanged near zero and continue buying $85 billion in debt each month…the correction in the Shanghai that started in February appears to have run its course, and that would be a positive development for global equities in general…below is an updated 6-month daily chart from John through yesterday’s trading…today’s action confirmed the breakout from the recent downtrend…

European markets are weaker today, generally off about 1%…in North America, the Dow is off 66 points through the first 40 minutes of trading while the TSX has declined 59 points to 12767…today is budget day in Canada with Finance Minister Jim Flaherty expected to deliver a stay-the-course plan after the markets close at 1 pm Pacific today…the Venture has given up a point to 1105…

Four-Week Average For U.S. Jobless Claims Falls To Lowest Level In Five Years

The number of Americans filing new claims for jobless benefits edged higher last week, but a trend reading dropped to its lowest in five years and pointed to ongoing healing in the labor market…initial claims for state unemployment benefits rose 2,000 to a seasonally adjusted 336,000, the Labor Department said this morning…economists polled by Reuters had expected 342,000 first-time applications last week…the four-week moving average for new claims, a measure of labor market trends, fell 7,500 to 339,750, the lowest level since February, 2008, which could bode well for job growth in March…

Screws Tighten On Cyprus

The European Central Bank set Cyprus a Monday deadline to agree a bailout plan, threatening to cut off funding to the islands’ cash-strapped banks if a program is not agreed by then with the EU and the IMF…the decision by the ECB’s Governing Council, announced this morning, gives Cyprus a last chance to agree a bailout that bears the EU/IMF stamp, or else succumb to financial meltdown…Cyprus has faced the prospect of bankruptcy since Tuesday when its tiny parliament voted unanimously against a levy on bank deposits to raise 5.8 billion euros ($7.51 billion) demanded by the EU under a 10 billion euro rescue…

Euro Zone Economic Downturn Deepens

Surveys compiled by Markit show the euro zone’s economic downturn has deepened this month, even before the Cyprus debacle erupted, creating another headache for policy makers battling to revive the bloc’s fortunes…the Flash Euro Zone Composite Purchasing Managers’ Index, which makes up about 85% of the final reading and is seen as a reliable economic growth indicator for the bloc, fell from February’s 47.9 to 46.5 in March…that was lower than all forecasts in a Reuters poll of 23 economists and far short of median expectations for a small rise to 48.2…the Index has been below the 50 mark that separates growth from contraction for all but one of the past 19 months…having already contracted since the second quarter of last year, Markit said the latest PMI data suggested the euro zone economy would shrink 0.3% in the current quarter…most survey responses were received before news of the Cyprus deal, including an unprecedented levy on all bank deposits, broke. Survey compiler Markit, who released the preliminary data and will issue final responses at the start of April, said the picture could be even worse by then…“Events that hit business confidence can have a very rapid effect on the data and so there is good reason to believe that responses we collect this week will on average be more negative,” said Chris Williamson, Markit’s chief economist…“It’s really quite disappointing…given the deterioration in the political and financial market outlook there is really little hope from what we see that there is going to be a turnround in the second quarter, and in fact more likely an increased weakening”…

EU Financial Conditions Index

Below is an interesting snapshot from Bloomberg of overall financial conditions across the EU…the Bloomberg European Financial Conditions Index (BFCIEU)  combines real-time measures of credit spreads, money markets, bond markets and more…as shown in the graph below, when financial conditions are tightening – a sign of growing risk and volatility in markets – the Index value declines, as it did in mid-2012 when Spain required a bailout…as you can see, financial prospects in the U.S. and Europe have been following diverging paths since February especially, even before the Cyprus problem…financial conditions in the U.S. remain much stronger than in Europe, and neither Index is anywhere near the lows of 2012…it’ll be important, however, to keep a watchful eye on the EU Index to see if the downward trend continues…if it starts to fall off a cliff, then that would mean contagion is spreading in the EU…

GoldQuest Mining (GQC, TSX-V) Updated Chart

Weak technicals continue to put pressure on GoldQuest Mining (GQC, TSX-V) while the company continues with its 30,000-metre drill program on the Las Tres Palmas trend in the Dominican Republic…in addition, recent comments by President Danilo Medina regarding Barrick’ Gold’s (ABX, TSX) Pueblo Viejo Mine have unnerved some investors who are now concerned about the threat of resource nationalism in that country…it seems politicians everywhere are very good at killing the goose that laid the golden egg…GQC is up half a penny in early trading at 39 cents…below is a 2.5-year weekly chart from John…the next major support level is 35 cents…

Lumina Copper Corp. (LCC, TSX-V) Chart Update

Gold Canyon Resources (GCU, TSX-V)

A support band between 30 and 43 cents continues to hold with Gold Canyon Resources (GCU, TSX-V) which has outlined more than 5 million ounces of Gold (indicated and inferred) at its Springpole Project in northern Ontario…RSI(14) appears to forming an important bottom below 30 as shown in John’s 4-year weekly chart below…

Note: John., Jon and Terry do not hold share positions in GQC, LCC or GCU.

Gold traded as high as $1,616 overnight…as of 6:45 am Pacific, bullion is off $5 an ounce at $1,608 in advance of the results of today’s Fed meeting…most observers agree, Chairman Ben Bernanke will likely keep the pedal to the metal – he is Wall Street’s best friend at the moment…Silver is down 7 cents to $28.84…Copper has gained 4 pennies to $3.44 after touching a 7-month low yesterday…Crude Oil has jumped 86 cents to $93.02 while the U.S. Dollar Index is off more than one-third of a point to 82.64…

Cyprus Turns To Russia

It appears Russia may come to the aid of Cyprus as the two countries continue negotiations after the Cypriot parliament rejected a bank deposit tax proposal Tuesday in return for receiving a bailout from its euro zone partners…time is of the essence, however, as Cyprus faces the imminent risk of a full banking meltdown and possible exit from the euro zone…banks remain closed…German finance minister Wolfgang Schäuble stated last night, “Cyprus is living with a banking sector with low taxes and favourable laws that is completely overdrawn and that makes Cyprus bankrupt…this business model is not sustainable”…Schauble is likely correct in his assessment (Cyprus is also a money laundering haven) but the fact the euro zone made the proposal it did, while also snubbing Russia which has a vested interest in Cyprus, has undermined some of the credibility it has built over the past year in handling the debt crisis…Athanasios Orphanides, former governor of the Central Bank of Cyprus, told CNBC this morning, “Confiscating profits in a banking system is not the way to deal with anything…if European governments do not want to continue to keep the European project together, then they keep forcing governments – in this case Cyprus – to look elsewhere”…

Updated Copper Chart

Consumption of metals has been lacklustre so far this year in China which accounts for 40% of global Copper demand…this has put pressure on the Copper price, driving it down to important support around $3.40…the key question is whether the $3.40 level will hold…John’s 3.5-year weekly chart below doesn’t give us a lot of confidence that it will given the fact that RSI(14) has broken below a trendline in place since late 2011…the trend is becoming more bearish…with Copper a leading indicator of the global economy, this is not a positive development as we approach the end of the first quarter of 2013…

Today’s Markets

China’s Shanghai Composite rallied 60 points or nearly 3% overnight, closing at 2317…markets are awaiting China’s HSBC Flash PMI data for the month of March tomorrow…European markets are significantly higher today while the Dow has gained 78 points to 14534 through the first 15 minutes of trading…the TSX has added 43 points while the Venture is up slightly at 1107…

U.S. Dollar Index Long-Term Chart

Below is a 20-year monthly U.S. Dollar Index chart from John that gives us confidence that the Index will ultimately bust through a resistance band between 83 and 84…next major resistance would then be 85…at that point, the greenback could go back into retreat but for now, at least, the bulls are in control…important bottoms in the Venture Exchange have occurred at tops in the Dollar Index, so this would suggest we will see a new low in the Venture but it may not occur until the Dollar Index is trading around 85…

Encanto Potash Corp (EPO, TSX-V) Update

Few stocks have been moving higher in this current Venture environment but Encanto Potash (EPO, TSX-V) has enjoyed a nice run recently, climbing from 23 cents last week to an intra-day high of 31.5 cents yesterday on volume of nearly 4 million shares…the company announced yesterday that the Muskowekwan First Nation potash mine project has been accepted by the federal government under the First Nations Commercial and Industrial Development Act (FNCIDA)…the act will enable the federal government to enact regulations that incorporate a provincial regulatory regime to govern commercial and industrial activities within a province…in addition to becoming the first on-reserve potash mine in Canada, the proposed Muskowekwan project is the first in Saskatchewan to utilize FNCIDA to regulate a project on reserve lands…once the project gets under way, it’s expected to generate approximately 1,000 construction jobs for the development of the mine and nearly 500 jobs once it is fully operational…in addition, the mine is expected to generate tens of millions in revenue royalties for the first nation annually…below is a 6-month daily EPO chart from John that shows technical resistance in the low 30’s…the stock is strong again in early trading this morning…

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

Gold is quiet so far today but holding above the $1,600 level…as of 7:10 am Pacific, bullion is flat at $1,606…technical support exists at $1,600 while the next important resistance level is $1,620…Silver is off 2 pennies at $28.88…Copper is up a penny at $3.43 after falling to its lowest level in more than four months yesterday on rising stockpiles and amid the bailout/taxation controversy regarding Cyprus which has unnerved many investors…Crude Oil is relatively unchanged a to $93.78 while the U.S. Dollar Index is also flat at 82.70…

U.S. Dollar Index Chart Update

The Venture Exchange and the TSX perform best when bears are in control of the greenback, but that hasn’t been the case over the past couple of years…the big question now is if the Dollar Index has enough strength behind it to blast through an important resistance band between 83 and 84, and there’s a good chance it does based on John’s 5-year weekly chart below (tomorrow, we’ll be posting a very revealing 20-year Dollar Index chart)…

Today’s Markets

Asian markets were mostly higher overnight, recovering from steep losses Monday…Japan’s Nikkei average jumped 248 points or 2% to close at 12468 while China’s Shanghai Composite gained 17 points to finish at 2257…European shares are slightly lower today…a German economic expectations index rose in March to its highest level in three years…however, the report also warned that the uncertainty regarding the EU/IMF bailout of Cyprus and the recent Italian election uncertainty could harm the German economic recovery in the coming weeks and months…also today, euro zone construction output fell sharply in January to its lowest level since 1997, suggesting the euro zone recession continues…in North America, the Dow is in positive territory after posting back-to-back losses for the first time in a month…as of 7:10 am Pacific, the Dow is up 46 points at 14498…the TSX has gained 33 points while the Venture is down a point to 1111…

Venture-Gold-CRB Comparative Chart

Below is a 2.5-year weekly chart from John that compares the CDNX with Gold and the CRB Index…notice how Gold recently found support at a trendline that previously was resistance…CDNX RSI(14) is flat and near support at 29%…

Contrarian Call Update – HXD (TSX)

Last Tuesday, we highlighted the HXD – the double short S&P/TSX 60 ETF which was trading in the $7.60’s at the time…it closed yesterday at $7.79 and has pulled back slightly this morning with the TSX up in early trading…the HXD broke above a down trendline in mid-February but has been confined since then to a horizontal trend channel between $7.60 and $8.00…RSI(14) is threatening to break above resistance at 50…

Barrick Gold Shipment Released From Customs In DR

Barrick Gold (ABX, TSX) said yesterday that a shipment of Gold from its Pueblo Viejo mine in Dominican Republic had been released from customs after it was detained four days ago…Barrick did not provide any additional details…the shipment had been detained by customs authorities in the Dominican Republic on March 14, 2013…the delay followed demands from politicians and Dominican President Danilo Medina that the company renegotiate its operating contract – according to them, the country is not reaping enough of the economic benefits from the mine which was built for nearly $4 billion (U.S.)…this is another classic example of “government greed” (and stupidity) – is any country really a “safe” jurisdiction”?…

Cypress Braces For Defeat On Deposit Levy

All indications are that the Cypriot government will not be able to push through parliament a levy on bank deposits, a key but dangerous component to unlocking a $13 billion bailout from international lenders…a draft bill, seen by the The Wall Street Journal, would spare savers with less than $26,000 in their bank accounts from the deposit levy…but a Cypriot lawmaker, citing the island’s central bank governor, said that the tax plan in the draft bill would fall $400 million short of the $7.5 billion revenue target the euro zone and the International Monetary Fund had demanded…a second official, according to the WSJ article, confirmed that the plan wouldn’t meet the promised amount…Cyprus has said that banks on the Mediterranean island will remain closed until Thursday, hoping that the bank holiday would give lawmakers enough time to pass the tax levy through parliament…”It is an explosive political situation,” Nick Spiro, head of Spiro Sovereign Strategy, told CNBC Europe’s “Squawk Box” this morning…”This is a rubicon which should have never been crossed…This bailout agreement has Germany’s political fingerprints all over it…If Germany’s aim was that the larger deposit holders, the Russian ones, were going to bear the brunt of this, then obviously it’s backfired,” he added…

U.S. Housing Numbers Continue To Pick Up Steam

Groundbreaking to build new U.S. homes rose in February and new permits for construction climbed to the highest level since 2008, a sign the nation’s housing market recovery continues to gain momentum…the Commerce Department said this morning that starts at building sites for homes rose 0.8% last month to a 917,000-unit annual rate, in line with analysts’ expectations…

Wall Street Expects More Of The Same From The Fed

Wall Street has boosted its outlook for quantitative easing (QE) from the Federal Reserve and reduced its concerns about a recession in the next year to the lowest level in 20 months, according to the March CNBC Fed Survey…the 54 respondents to the survey, including economists, analysts and money managers, now believe the Fed will purchase $917 billion of additional assets this year in its open QE program, up from $858 billion in January…the new total works out to around $76 billion monthly, which remains below the current $85 billion pace…the FOMC begins two days of meetings today…

Gold is firmer this morning, thanks to a broad reminder to investors about the perils of debt with a bite being taken out of depositors’ accounts in Cypriot banks in order to help pay for a bailout of the island’s financial system – a decision that may end up haunting the euro zone…as of 7:00 am Pacific, bullion is up $17 an ounce at a 3-week high of $1,610…Silver is up 24 cents at $29.01…Copper has tumbled 8 cents to $3.43…Crude Oil has lost $1.13 a barrel to $92.32 while the U.S. Dollar Index is off one-fifth of a point to 82.67…

Oops - Out Of Order, Country is Bankrupt

Cyprus Bailout/Tax Heist

The Wall Street Journal reports this morning that, according to two European officials with knowledge of the situation, Cyprus is preparing a new proposal for its prospective international lenders that will ease the pain of an extraordinary deposit tax for smaller depositors…the new proposal will aim to raise $7.6 billion U.S., the amount already set as a requirement for Cyprus’s $13 billion bailout from the euro zone and the troika of lenders made up of the European Commission, the European Central Bank and the International Monetary Fund…the new proposal will see smaller depositors, those with up to $130,000, taxed at 3%; savers with $130,000 to $650,000 taxed at 10%; and those with over $650,000 taxed at 15%, one official said…Cyprus is a nation of only 800,000 people and has approximately $90 billion in deposits, much of this held by Russians and other foreigners (various reports have stated that Russians had stuffed between $25 and $35 billion in Cypriot banks)…

The decision to impose this unprecedented tax on depositors risks a political backlash for the newly elected center-right government on the Mediterranean island and a wider political fallout for the euro zone leaders who are guiding the bloc’s crisis strategy…the tax was the only way out for the bloc’s finance ministers after Germany, the euro zone’s biggest economy, and the International Monetary Fund insisted that financial aid to Cyprus should be limited to $13 billion…

Cyprus state broadcaster CYBC reported that a man drove a bulldozer into a bank branch in Limassol, the island’s financial centre, to protest the levy…euro zone finance ministers should be more concerned, however, about what kind of retaliation Vladimir Putin has in mind…

Changes In China?

The news out of Cyprus overshadowed interesting developments in China over the weekend…the new premier of China pledged to curb the power of bureaucrats, rein in government spending and provide a more level playing field for private enterprise in the world’s second-largest economy…“The reform is about curbing government power; it is a self-imposed revolution…it will require real sacrifice and this will be painful,” Li Keqiang said at a news conference to mark the close of China’s ceremonial parliament on Sunday, just two days after he replaced Wen Jiabao as premier…in another hopeful sign for global investors, Keqiang singled out the state-dominated railway, energy and financial sectors as areas where Beijing would allow private capital “to enter more smoothly and effectively”…

Meanwhile, just as concerns over a hard landing in the world’s second largest economy look to have faded, economists at Nomura have sounded a warning that the Chinese economy is exhibiting the same worrying symptoms that triggered the 2008 financial crisis…the country’s rapid buildup of leverage, decline in potential growth and elevated property prices, are three red flags that should not be downplayed, according to Nomura economists Zhiwei Zhang and Wendy Chen…”China faces rising risks of a systemic financial crisis and the government needs to take action quickly to contain such risks…we believe the true extent of financial risks in China is not fully appreciated by investors,” the two wrote in a report released over the weekend…

Today’s Markets

Asian markets were down sharply overnight, led by Japan’s Nikkei Average which tumbled 2.71% or 340 points to close at 12261…diminishing concerns about Europe’s sovereign debt crisis have largely underpinned much of Asia’s stock market gains in 2013 and investors are wondering if the Cyprus bailout deal could spark a fresh risk-off trade…China’s Shanghai Composite fell 39 points to 2240, its lowest level in two months…European shares are off their lows of the day with markets generally off about 1%…the Dow is down 55 points as of 7:00 am Pacific…the TSX, aided by a rising Gold Index, has slipped only 50 points while the Venture is down 3 points to 1114…

CDNX-Gold Comparison

It’ll be interesting to see how the Venture Exchange performs in the event of a broad market pullback with Gold turning to the upside…over the last year or so, the Venture and Gold have essentially moved in tandem after the CDNX strongly under-performed against bullion in 2011 (notice in the 5-year weekly chart below how the Venture started going in the opposite direction of Gold in 2011 – a clear warning sign after a period of out-performance by the Venture)…so far in 2013., through the end of last week, Gold is down 6% while the Venture has declined 8.5%…

Updated Long-Term Silver Chart

Short-Term Silver Chart

TomaGold Corp. (LOT, TSX-V) Updated Chart

Drilling continues at the Monster Lake Gold discovery where TomaGold Corp. (LOT, TSX-V) and Real Quinto Capital Corp. (QIT, TSX-V) launched a Phase 2 program a week ago in an attempt to extend high-grade mineralization at depth…expect continued volatility in both plays with LOT showing Fibonacci support at 24 cents…as of 7:00 am Pacific, LOT is up a penny at 27 cents…

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

TSX Venture Exchange and Gold

It was a quiet week for the Venture as it traded between a low of 1109 and a high of 1122 on light volume.  For the first time since late January, the Index is trading above its 10-day moving average (SMA) and appears to have stabilized after its worst February ever.  An important discovery and/or a major Gold rally are the catalysts needed to lift this market out of its doldrums.  The Venture continues to closely track Gold.  For the year, Gold is down just over 6% while the Venture is off 8.5% (the TSX Gold Index, by comparison, has lost 17% so far this year).  Over the last 5.5 months, Gold has fallen 11% while the Venture is off 17%.  So a recovery by bullion can only help the Venture.

Below is a 5-year weekly CDNX chart from John.  There is strong Fibonacci support around 1100, but failure of that support would likely mean a test of the 1027 level which was the bottom of the summer 2009 correction.  On an encouraging note, RSI(14) has so far held above its lows from last year despite the fact the Index recently plunged to a new 52-week (and 3.5-year) low.  Only time will tell, but that’s a potentially important divergence.  And a positive contrarian sign, of course, is that sentiment levels regarding junior resource stocks and Gold are at such extreme lows.  A turnaround is coming – when is the big question.  The strong will survive and thrive; the weak will perish.

Gold

Gold has been basing within a support band between $1,550 and $1,600 for the last several weeks and appears ready to stage a breakout above $1,600.  It’s interesting that despite all the negative sentiment toward Gold at the moment, including record high short positions held by large speculators (short squeeze coming?), bullion is holding up as well as it is.  Physical buying out of Asia has reportedly been strong, and that’s an important sign.  Many North American investors simply don’t put Gold into a global context, or don’t fully appreciate the extent to which China and other emerging markets are positioning themselves with bullion.  Hence, we continue to hear the ridiculous argument that Gold has been in a “bubble” and that the bubble has burst.  To the contrary, Gold for the past year-and-a-half has been in a very normal consolidation phase and the base is being built for the next massive wave up.

Gold gained $14 last week to close at $1,593.  RSI(14) is now beginning to climb, as shown in John’s 2.5-year weekly chart below, and selling pressure is in decline.

Silver fell 23 cents last week to close at $28.77 (John will have his usual updated Silver charts Monday morning).  Copper was relatively unchanged at $3.52.  Crude Oil gained $1.81 a barrel to $93.45 while the U.S. Dollar Index lost half a point and closed at 82.13.

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), a Fed balance sheet now in excess of $3 trillion and expanding at $85 billion a month, 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.

Welcome to our site, or at least the initial version of it!  BMR has been online for more than 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,

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.