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Gold has traded between $1,326 and $1,338 so far today…as of 7:05 am Pacific, bullion is down $2 an ounce at $1,333 after closing at a 4-week high yesterday…Silver is off 25 cents at $20.30…Crude Oil has slipped 79 cents to $106.15…Copper is unchanged at $3.16 while the U.S. Dollar Index is up one-tenth of a point at 82.27…

Commerzbank says it’s probably too soon to call Gold’s bounce a lasting reversal, and they’re likely correct…“The crossing of the $1,300 threshold evidently prompted investors to cover their short positions, thereby further boosting the price increase.  That said, given the ongoing ETF (exchange-traded-fund) outflows, we believe it is still too early to describe this as a lasting trend reversal.  What is more, the Indian central bank yesterday evening announced additional measures aimed at curbing Gold imports – these are likely to further cool demand in a country that is still the world’s largest Gold consumer.  For one thing, imports will be linked to exports in future. For example, 20% of the imported volume will have to be re-exported in the form of jewelry. What is more, it will only be possible to sell Gold to the jewelry industry and importers will have to retain Gold in warehouses“…

The All India Gems & Jewelry Trade Federation estimates that Gold imports in the second half of the year will fall 63% year-on-year to 175 metric tons, a figure disputed by Commerzbank…“In our opinion, this is an overly pessimistic appraisal which is probably aimed at encouraging the Indian central bank and government to loosen the restrictions“…

Today’s Markets

Chinese stocks led Asian markets higher overnight as speculation grows that Beijing may take stimulus measures to boost a slowing economy…the Shanghai Composite rallied 39 points or almost 2%, closing at 2044…Japan’s Nikkei average climbed 120 points to finish at 14779…European stocks are modestly higher in late trading overseas…In New York, new record highs this morning in both the Dow and the S&P 500 thanks to some stronger-than-expected earnings reports…as of 7:05 am Pacific, the Dow is up 38 points to 15584…the TSX is 3 points higher while the Venture has added a point to 930…Zenyatta Ventures (ZEN, TSX-V) continues its impressive run with a breakout this morning to a new high, but where it closes today will be key…it’s up 18 cents to $4.34 through the first 35 minutes of trading…GoldQuest Mining (GQC, TSX-V) is looking strong in early trading today…initial drill results from the Guama trend west of Romero can’t be far off, and a fresh discovery would give GQC a powerful lift…

Crude Oil Chart

One of the factors driving Gold over the last couple of weeks has been the jump in Crude Oil prices to 16-month highs…demand for imported Oil is falling rapidly with the increased ability to get western Oil (WTIC) to markets on the U.S. Gulf Coast and the West Coast…yesterday, WTIC climbed to a premium against Brent for the first time since 2010…so with Crude in the spotlight, let’s take a look at a couple of charts…

The 10-year monthly chart is quite striking as it shows that while WTIC is currently near important resistance at $110, there is clearly potential for a major breakout to the upside – not necessarily immediately, but perhaps in the coming months…this would likely catch a lot of investors by surprise and could hurt U.S. growth prospects…that’s why John has titled this chart, “The Looming Crisis In Oil Prices”…at some point, however, demand destruction will set in if Oil prices climb too high as we’ve seen in the past…

WTIC 6-Month Daily Chart

The short-term chart for Crude shows temporarily overbought conditions, strong resistance at $110 but plenty of support between $100 and $104…

Pacific Potash Corp. (PP, TSX-V) Chart Update

What we’ve considered in recent months to be one of the top plays on the Venture – Pacific Potash Corp. (PP, TSX-V) – continues to look strong and has impressive liquidity…PP gained 2 cents yesterday to close at 19 cents after announcing it intends to commence a 6-well drill program in September at its Amazonas Potash Property in northwestern Brazil…below is a 2.5-year weekly chart update from John…a breakout at some point this quarter appears likely…

Victory Ventures (VVN, TSX-V) Update

There has been considerable staking recently in the general vicinity around the newly-named Sheslay River Project, optioned by Pete Bernier’s Prosper Gold (PGX., TSX-V), and Garibaldi Resources‘ (GGI, TSX-V) Grizzly Property that adjoins the western and southern boundaries of the Sheslay…this speaks to how hot this entire area could become with Bernier’s arrival on the scene and now that an exploration program has started at Sheslay with drilling expected to commence by early next month…Victory Ventures (VVN, TSX-V) is first out of the gate to announce that it has acquired some claims near the Grizzly, with that news coming out this morning, and more companies will be following suit in the near future…in the case of Victory, we’re still shaking our heads over the company’s news earlier this month regarding its acquisition of the Fortuna Property near Kamloops (claims conveniently purchased from VVN’s President) followed by a sloppy description (and an even more confusing “clarification” a couple of days later) of its first hole drilled at the Copau Property near Iskut…at the end of May, no company was in a better position to benefit from Colorado Resources‘ (CXO, TSX-V) exciting discovery at North ROK than Victory given the drill-ready status of Copau and the two financings VVN completed in May…the company had built up plenty of momentum and its stock price doubled…but then they popped their own balloon by announcing the Fortuna acquisition (confusing signal to the market, why not more ground near Iskut?) while also fumbling the ball with their drill program at Copau…we’re still holding out hope that Victory will get its act together, and perhaps this morning’s news is a start (cynics may say it’s a sign of desperation), but they have done serious damage to their brand and have shaken investors’ confidence in the company over the last few weeks…more drilling at Copau is scheduled for early next month…the Venture market is risky enough given the volatility of metal prices and the hit-and-miss nature of the exploration business…investors have little tolerance these days for companies that find a way to trip over their own feet and can’t effectively execute opportunities to drive shareholder value…

Amarc Resources Ltd. (AHR, TSX-V) Update

We expect British Columbia to be an exploration hotspot this summer, and a company to keep an eye on in that respect (as we’ve mentioned on previous occasions) is Amarc Resources (AHR, TSX-V) which has five separate high quality deposit targets in the province (Au, Ag and Cu)…technically, AHR is beginning to look a lot healthier…below is a 2.5-year weekly chart…AHR closed at 6.5 cents yesterday (resistance), putting it above its 100-day moving average (SMA) for the first time in more than 6 months…as always, perform your own due diligence…

Aldrin Resource Corp. (ALN, TSX-V) Update

Aldrin Resources Corp.’s 12,000-hectare Triple M Property in the Patterson Lake area of Saskatchewan (9 kilometres south to 11 km west of the Fission-Alpha Minerals discovery) should stir up interest as the year progresses, with drilling currently planned for January…the conductive trends at Triple M property parallel the mineralized Patterson Lake conductors and fault…ALN has shown good liquidity and is very close to breaking above a long-term down trendline as shown in John;s 3-year weekly chart…

Note: John and Jon both hold share positions in GGI and VVN.  Jon also holds a share position in PP and GQC.

Gold has pushed solidly through $1,300 to begin the new week after finding resistance at that level last week…as of 6:10 am Pacific, bullion is up $25 an ounce at $1,322…Silver has added 75 cents to $20.28…Copper is up 4 pennies to $3.17…Crude Oil is up another 71 cents to $108.76, climbing to a premium against Brent for the first time since 2010…the U.S. Dollar Index has slid one-tenth of a point to 82.37…

Rising Oil prices, short-covering and continued robust demand for Gold from Asia have combined to send Gold prices to a 1-month high today, impressive follow-through after bullion posted its biggest 32-week gain since November, 2011…Tanaka Kikinzoku Kogyo K.K., Japan’s biggest Gold retailer, has reported that its sales tripled in the second quarter from the previous 3 months… imports by India may climb to more than 900 metric tons in 2013 from 860 tons last year, and China’s purchases may top 1,000 tons, up from 817 tons, the London-based World Gold Council said July 17…although peak demand for physical Gold may have slipped back from the huge surge seen particularly in April when the price fell so sharply, it still remains very strong compared with prior years according to the WGC…Gold premiums in both India and China remain at high levels at a seasonally weak period of the calendar for Gold…

“We are seeing some support for Gold as Bernanke’s statements tell us that the Fed wants to see a visible improvement in economic conditions before they begin tapering,” said Michael Cuggino who manages $12 billion of assets at Permanent Portfolio (PRPFX) Familyof Funds Inc. in San Franciswco…(source: Bloomberg)… “The longer-term reasons for owning Gold, like capital preservation, remain as easy money will continue to flow into the system”…Gold ETP holdings fell 2.9 metric tons to 1,976 tons last Friday, the lowest since May, 2010, according to data compiled by Bloomberg…but the 10.2 tons sold last week was the least since May…

As John’s charts have shown, Gold has a resistance band between $1,320 and $1,350…this will be bullion’s next key hurdle to overcome…it’ll also be interesting to see if there’s any significant producer hedging above $1,300 an ounce…

Today’s Markets

Asian markets were modestly higher overnight after Japanese Prime Minister Shinzo Abe’s landslide victory in Sunday’s upper house elections signaled a green light for future monetary stimulus…Japan’s Nikkei average climbed 68 points to close at 14658…China’s Shanghai Composite, meanwhile, erased early losses to close 12 points higher at 2005…late Friday, China offered its strongest signal yet of worry over slowing growth and its commitment to financial reform as it loosened a key control over its banks…over the weekend, China’s central bank scrapped controls on lending rates and started to let financial institutions price loans by themselves…the move could let some borrowers tap cheaper loans at a time when China’s economy threatens to slow to a 20-year low and as corporate and local government borrowers struggle with a growing burden of interest payments…

European shares are mixed in late trading overseas…in New York, stock index futures as of 6:10 am Pacific are pointing toward a slightly lower open on Wall Street…economists now believe the U.S. economy grew at an annualized rate of just 1.5% in the second quarter, according to The Wall Street Journal’s latest survey of forecasters…the economists have become markedly more pessimistic since June, when they estimated a 1.9% pace for second-quarter growth, and several forecasters now believe the growth rate fell below 1% for the second time in the past 3 quarters…economists do expect modestly faster growth in the 2nd half of the year: at a 2.4% annual rate in the third quarter and 2.7% in the fourth, according to the Journal survey…but even if those projections hold up, that would suggest another year of anemic growth around 2%, not enough to bring down unemployment quickly – hence the reason for Bernanke’s more cautious tone last week with regard to when the Fed may start to reign in its bond-buying…meanwhile, President Obama will begin laying the groundwork for a new battle with Republicans over the budget, including a raising of the debt ceiling, with a series of speeches on the economy beginning Wednesday in Illinois…

With Gold prices busting through $1,300, expect a solid day for the Venture Exchange which should be able to push above its 50-day moving average (SMA) for the first time in more than 6 months…volume improved last week but given the time of the year, it’s still on the sluggish side…

Powerful Dynamics At Work In Garibaldi Resources (GGI, TSX-V)

Garibaldi Resources‘ (GGI, TSX-V) sound stewardship, geological expertise, persistence and good luck have all combined to create an historic and immediate opportunity for the company and investors as the Venture shows signs of staging a strong rebound during this 3rd quarter…with nearly $5 million in working capital as reported in its most recent financials (April 30), Garibaldi is one of the few Venture-listed companies that remarkably has NOT had to do a financing during the last 4 years, thereby creating a clear runway for the share price as some important “trigger” events unfold…

Garibaldi has made excellent progress in Mexico where it holds 3 district-scale projects in robust mining areas, one of which is showing strong potential for hosting a large Gold-Copper porphyry system…Agnico-Eagle, Coeur d’Alene, AuRico Gold and Paramount Gold and Silver have each purchased proprietary Hyperspectral remote sensing data from Garibaldi which has been able to use this proven, low-cost reconnaissance exploration tool to effectively map the alteration minerals associated with epithermal and porphyry type deposits throughout the Sierra Madre…Garibaldi has 100% ownership of more than 1,000 sq. km in this prolific area of Mexico, and they’ve already demonstrated their ability to create value there through development of the Temoris Concessions and the sale of that option in 2009 to Paramount…GGI has immense potential just with its Mexican assets…

But Garibaldi’s best-kept secret at the moment, and an immediate catalyst, is its 170 sq. km Grizzly Property that adjoins the western and southern boundaries of the newly-named Sheslay Porphyry Project in northwest British Columbia…we cannot emphasize enough the importance of the Grizzly, strategically and geologically, now that Pete Bernier and his Prosper Gold (PGX.H, TSX-V) team have selected this area as the next chapter in their incredible story that began with Blackwater…Dirk Tempelman-Kluit is one of Canada’s premier geologists, and it was his expertise that allowed Richfield Ventures to make one of Canada’s biggest-ever Gold discoveries west of Ontario a few years ago…Richfield went from pennies to more than $10 a share as it was acquired for half a billion dollars by New Gold Inc. (NGD, TSX) in 2011…the level of execution displayed by Bernier’s Richfield team over such a short period at Blackwater was phenomenal, and we know because we followed that story closely from the beginning…they created immense value and also turned Blackwater into a very significant area play…there’s a good chance they’ll repeat that success at Sheslay which they’ve optioned from Firesteel Resources (FTR, TSX-V)…the implications for Garibaldi – trading at merely 8 cents a share, its working capital – could be profound…

As Bernier explained in Prosper Gold’s news release last Thursday: “Since the sale of our last company, Richfield Ventures in 2011, it has taken us two years to identify a multiple bulk-tonnage Copper-Gold target area, with historical drill confirmed discoveries that met our exploration criteria for Prosper Gold.  The Sheslay project area is close to infrastructure, drill permitted and drill ready. We look forward to advancing the project in the near term.”

Bernier is not wasting any time…a field exploration program has already started, and a 5,000-metre Phase 1 drill program is slated to begin by early next month…rest assured, he and his team will move at lightening speed with amazing efficiency and precision…Tempelman-Kluit is a genius at data compilation and interpretation, and he has plenty of historical data to guide him on this project…they will drill deeper than Firesteel ever did and they will also drill right through the winter if they see fit…they have strong financial resources, personally and through their network that made fortunes on Richfield…

We’ll have much more on the potential of the Sheslay Project this week, but the fact that Bernier’s Brigade is descending on the area has suddenly made the Grizzly one of the most valuable pieces of real estate in this most northerly part of B.C.’s infamous “Golden Triangle”…largely due to its easier access, Sheslay is much more advanced from an exploration standpoint…but there’s an intimate connection between the Sheslay and the Grizzly, and the “blue sky” potential of the latter is very evident based on airborne magnetic surveys, other data, and common sense…particularly intriguing is the northwest corner of the Grizzly which features the Kaketsa Pluton, an elliptical, north-trending intrusion approximately 4 x 5.6 km in size and interpreted by geologists as an important “heat engine” driving mineralizing fluids – at both the Grizzly and the Sheslay…

A Picture Tells A Thousand Words

Follow this closely…below is a map from a 2012 Grizzly technical report, showing the entire 170 sq. km Grizzly Property and the 68 sq. km Sheslay Project…4 of the 5 porphyry bodies identified to date at the Sheslay (more will likely be discovered) are clustered within a 12 sq. km target area (Star)…the Pyrrhotite Creek porphyry, according to Prosper Gold, appears to be located in a second distinct multiple target area to the southwest near the Sheslay-Grizzly boundary…meanwhile, note the 4 known alkalic porphyry Cu-Au showings (Grizzly, Kid, Ho and West Kaketsa) discovered historically through intermittent exploration within the NW corner of the Garibaldi claims…keep in mind, this entire area of the Grizzly is still very under-explored…what we do know from historical reports is that the mineralization observed at West Kaketsa (highly altered and sheared volcanic and intrusive rocks containing disseminated and fracture controlled chalcopyrite over exposed widths of at least 24 metres) resembles that at Pyrrhotite Creek…only 3 shallow holes have ever been drilled at the Grizzly – more than 3 decades ago, and in the NW corner of the property…each hole reportedly intersected potassic alteration and Copper mineralization, though no values are available and apparently none of the holes was assayed for Gold…

Imagine for a moment that you’re Pete Bernier or Dirk Tempelman-Kluit standing in the middle of the Sheslay Project…you’re thinking big, and everywhere you look to the west and the south you see a Grizzly, pardon the pun…Garibaldi is in a very enviable position, holding important pieces of this huge geological puzzle covering 240 sq. km…meanwhile, a major (Teck Resources, TCK.B, TSX) has staked a large parcel of ground right up to the southern border of the Grizzly…this whole area is right on trend with massive deposits to the south…the potential scale of this is truly immense, especially considering the players involved…Garibaldi President and CEO Steve Regoci has his hands full, first with quality assets in Mexico and now also with the Grizzly…he understands how recent events have made the Grizzly a “game changer” for GGI, and this very capable leader plans to take full advantage of the opportunity…he has also agreed to an interview in the very near future with BMR, so we look forward to exploring all dimensions of this fascinating story in the days and weeks ahead as drilling commences at Sheslay…

While Colorado Resources (CXO, TSX-V) continues to make impressive progress 60 miles to the east at its North ROK Property, investors will soon realize that there are two major plays in this part of northwestern British Columbia…as prospective as North ROK is, the Sheslay and the Grizzly are about to command some major attention…

Garibaldi Updated Chart

If a company’s fundamentals are changing for the better, as they clearly are for Garibaldi, then this should be reflected technically in the behavior of the stock…indeed, that’s what we’re seeing…there are several recent key developments in the GGI chart…

1. RSI(14) has broken above long-term resistance;

2. The 50 and 100-day moving averages (SMA’s) have each reversed to the upside;

3. The share price has broken above a 6-month horizontal channel;

4. Buying pressure has replaced selling pressure, dominant since September of last year.

As always, perform your own due diligence…a combination of fundamental and technical factors has us convinced that Garibaldi’s current strength is just the beginning of a major move…

Zenyatta Ventures Ltd. (ZEN, TSX-V)

Zenyatta Ventures Ltd. (ZEN, TSX-V) has been an excellent example of tremendous execution both on the ground and in the market, reminiscent of Bernier’s success with Richfield though of course Zenyatta is developing a hydrothermal graphite deposit…we remain bullish on Zenyatta’s prospects but investors must keep in mind there will be pullbacks on profit-taking which will also help to unwind temporarily overbought conditions…below is a 2.5-year weekly chart from John that shows an interesting upsloping wedge…last week, ZEN hit the top of the upsloping wedge ($4.17) before giving up about 10% to close the week at $3.72…it’s possible ZEN could re-test the the top of that upsloping wedge in the coming days…but the chart clearly suggests that at least a short period of consolidation is likely after a 50% jump in the share price over the last month…if past experience with ZEN is any guide, the 20-day moving average (SMA) – currently just below $3.45 – should provide strong technical support…there is huge support at $2.50, but a retracement of that magnitude doesn’t seem likely…

Updated Short-Term Silver Chart

Important support for Silver has held in the band between $17.50 and $19.50…up momentum is slowly increasing, and the technical case is certainly strong for higher prices during this 3rd quarter…

Long-Term Silver Chart

What’s bullish about this 11-year monthly chart is the RSI(2) which remains at an extreme 1.04%…this kind of low reading simply cannot last much longer…a strong case can be made that we could see a 30% jump in Silver prices during this 2nd half of 2013 with a test of the $26 area – previous strong support that is now important resistance…

Note: John and Jon both hold share positions in GGI.

TSX Venture Exchange and Gold

The Venture posted its 3rd consecutive weekly advance as a summer rally starts to gain traction.  The Venture climbed 22 points last week to finish at 920, putting the Index at its 50-day moving average (SMA) for the first time in 5 months.  Whether the Venture will immediately push higher or temporarily pause at this level, where there is resistance, is anyone’s guess, but the big picture for this 3rd quarter is looking quite positive.  Extreme oversold conditions emerged during the April-May-June period.  The Index tested important support at 860 and a recovery process is now underway.  A 20% rally to the 200-day moving average (SMA) around 1100 over the next 2-3 months cannot be ruled out, and in that kind of environment astute traders/investors can profit handsomely.   The Venture has out-performed the TSX Gold Index in each of the last 3 quarters and the Gold Index is also due for a sharp rally that could easily take it to the 210 area, nearly 20% higher than it is now.  This is also a period of seasonal strength for Gold and Gold stocks.

So let’s take a look at John’s latest CDNX chart (9-month daily).  What’s particularly interesting is that there has been a bullish +DI/-DI crossover in the ADX trend indicator.  There was a bearish crossover at the end of February, and we all know what happened after that.  A bullish trend, therefore, is beginning to take shape, and for the first time in 5 months the Venture’s 20-day moving average (SMA) is also rising.  If this rally is for real, then it will find support at the 10 or 20-day SMA’s which are currently at 898 and 887, respectively.  On Friday, the Index closed 2 points above the 918 resistance.  This “breakout” requires confirmation Monday.  Either that will occur, or the Index will need to pause and catch its breath before garnering the strength to bust through this level.  Of course a major resistance area is 970 – a move above 970 would signal that it’s “game on” for a major rally.

Exploration results and the Gold price, of course, will be the key catalysts for the Venture this summer.  This market needs more success stories to increase investor confidence.  The opportunities for that do exist.

Gold

Gold flirted with the $1,300 level last week and closed Friday at $1,297.  John’s 2-year weekly chart offers some hope.  Sell pressure is declining rapidly, and the bearish trend is weakening.  There is a strong resistance band between $1,320 and $1,350, and that’s an area we believe Gold may test in the near-term.  Patience is critical.  Gold has suffered a lot of technical damage in recent months and the climb back up won’t be easy.  There will be a strong focus on demand/supply factors in the coming weeks and months, but that should be positive for Gold at current levels.  The best cure for low prices is low prices.

John has updated charts for Silver in Monday’s Morning Musings.  Silver closed Friday at $19.53.  Crude Oil (WTIC) soared to a new 16-month high, closing the week at $108.05.  Copper finished at $3.13 while the U.S. Dollar Index closed at 82.62.

The “Big Picture” View Of Gold

As Frank Holmes so effectively illustrates at www.usfunds.com, the long-term bull market in Gold has been 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, has had a huge impact on bullion.  Despite its current weakness, the fundamental long-term 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, a Fed balance sheet now in excess of $3 trillion and expanding at $85 billion a month, money supply growth around the globe, massive government debt from the United States to Europe, central bank buying, flat mine supply, physical demand, emerging market growth, geopolitical unrest and conflicts…the list goes on.  However, deflation is prevailing over inflation in the world economy and this had a lot to do with Gold’s recent plunge below the technically and psychologically important $1,500 level, along with the strong performance of equities which are drawing money away from bullion.  Where and when Gold bottoms out in this cyclical correction is anyone’s guess, but we do expect new all-time highs later in the decade.  There are many reasons to believe that Gold’s long-term bull market is still intact despite a major correction from the 2011 all-time high of just above $1,900 an ounce.

Welcome to our site, or at least the initial version of it!  BMR has been online for almost 4 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 intent is to provide you with information that you can use as part of your own due diligence.  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.  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 perspective (His money that we have been given stewardship of), He will bless you.  This all begins, of course, with a personal relationship with Jesus Christ by accepting Him as your Lord and Savior and putting Him at the throne of your life.  It is the most important decision you’ll ever make.

God Bless,

Terry Dyer

Owner/Publisher, www.BullMarketRun.com

Disclaimer:

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

Forward Looking Statements:

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

Gold is trying to close the week on a strong note…as of 6:50 am Pacific, bullion is up $9 an ounce at $1,292…Silver has climbed 6 cents to $19.44…Copper is up 2 pennies to $3.14…Crude Oil (WTI) has hit a fresh 16-month high and is currently up 63 cents to $108.63, while the U.S. Dollar Index is off slightly at 82.72…

TSX Gold Index & Gold Comparative Chart

The outlook is becoming increasingly bullish for Gold and Gold stocks based on this 2.5-year comparative chart from John this morning…this doesn’t necessarily mean that we’ve seen the lows for Gold in this cycle, but a very strong rally could be in the works for this 3rd quarter…

Today’s Markets

Asian markets were mostly lower overnight with Japan’s Nikkei average slipping 219 points or 1.5% to close at 14590…China’s Shanghai Composite also fell by 1.5%, losing 31 points to finish the week at 1993…European shares are modestly lower in late trading overseas…meanwhile, the Dow is down 55 points through the first 20 minutes of trading while the TSX has gained 16 points to 12645…the Venture is up a point at 916 and poised for a solid advance this week…its 20-day moving average (SMA) is also reversing to the upside…

Prosper Gold (PGX.H, TSX-V) Finalizes Deal With Firesteel Resources (FTR, TSX-V)

Starting Gun Ready To Be Fired At Sheslay Porphyry Project

If it’s a Pete Bernier deal, you know it will be executed with incredible precision and the likelihood of success is high…that’s why we’re so excited about the prospects for Prosper Gold (PGX.H, TSX-V) in the prolific but under-explored Telegraph Creek area of northwestern British Columbia – about 60 miles west-northwest of Colorado Resources‘ (CXO, TSX-V) North ROK discovery…drilling commences shortly at Sheslay (formerly Copper Creek), an advanced exploration play with huge upside potential that’s in the best hands possible with award-winning geologist Dirk Tempelman-Kluit…

“Since the sale of our last company, Richfield Ventures in 2011, it has taken us 2 years to identify a multiple bulk-tonnage Copper-Gold target area, with historical drill confirmed discoveries that met our exploration criteria for Prosper Gold,” stated Bernier in a news release yesterday…”The Sheslay project area is close to infrastructure, drill permitted and drill ready…we look forward to advancing the project in the near term“…

We’ve just recently had our boots on the ground in northwestern British Columbia, and we’ve spoken to numerous geologists and prospectors regarding the Sheslay and surrounding area…some of the surface showings at the Sheslay are reported to be spectacular, and below is just one example – a picture of a gossan which is included in Firesteel’s corporate presentation…

Supergene gossan on the Sheslay Porphyry Project. A 2011 technical report on the property stated the following: "The property exhibits great potential both in mineable size and grade…after reviewing numerous assessment and Minfile reports on the property, it is apparent that the Copper grades, at least near-surface, are an average of 0.48% over extensive lengths, depending on the drill hole…trenching has reproduced similar numbers, and some grab samples returned values as high as 17.2% Copper…the onsite topography…suggests a large-sized potential deposit as the topography mimics the stratigraphy, so those areas that are under moss or devoid of outcrop and have never been drilled show great potential in continued mineralization on proximity alone…the extensive roadside locations of outcrop that were splashed with azurite, malachite, pyrite, pyrrhotite and a variety of other (as yet unknown) sulphides demonstrate the promising potential of an area that extends beyond one km in any direction, with deep subsurface drilling yet to establish the true extent to depth.”

Sheslay Porphyry Project And The Garibaldi Resources’ (GGI, TSX-V) Tie-In

Garibaldi Resources (GGI, TSX-V) has commenced an important technical breakout – see John’s updated chart below…what’s driving this is Garibaldi’s 170 sq. km Grizzly Property in the heart of an area that we’re convinced is going to yield superb results and bring some much needed excitement to the Venture Exchange…as we recently predicted, Bernier and his highly respected Prosper Gold team have hit the ground running at the newly-named Sheslay Porphyry Project…many investors are still not familiar with this project, let alone the fact that Garibaldi holds a very valuable piece of real estate contiguous to the western and southern boundaries of Sheslay…there’s a clear geological connection between the properties…the Grizzly is also even bigger – 17,000 hectares vs. Sheslay’s 6,800 hectares…

In Prosper Gold’s news release yesterday morning, announcing a final option agreement for Sheslay with Firesteel in addition to immediate exploration plans including drilling, you’ll notice the release made mention of the “Kaketsa granodiorite pluton” – this important intrusive is actually situated in the northwest corner of the Grizzly…it measures approximately 4 km by 5.6 km in surface extent and some geologists believe it’s a key “heat engine” for the entire area…a 2012 technical report described this feature as an “elliptical, north trending intrusion…a number of potentially economic Copper prospects occur near the contacts of the Kaketsa Pluton and its related smaller stocks“…the western portion of the Grizzly is highly interesting but has been under-explored…in 1988, Corona completed prospecting, rock sampling and an extensive soil geochemical survey that confirmed significant Gold values associated with the Copper mineralization in the western corner of the property…meanwhile, there’s also a large “South Target” at the Grizzly, confirmed by an airborne survey that was completed in 2006 which revealed the following…

“For comparative purposes this survey covered the southern part of Firesteel’s Copper Creek Property…results of the airborne magnetic survey showed that the rock units and structures which underlie the Copper Creek prospects appear to continue into the large area of low relief within the Garibaldi claims and identified several magnetic anomalies which are similar to the magnetic anomalies that are associated with the mineralized zones which comprise the Copper Creek Property; this area is referred to as the ‘South Target’…during 2007 and 2008 Garibaldi completed orientation soil geochemical surveys which reportedly returned Copper values within the anomalous range determined by Firesteel for the Copper Creek property, however the surveys only covered a small fraction of the prospective area and will need to be expanded to cover the area of interest defined by the airborne magnetic survey…during late 2008 Garibaldi completed a comprehensive literature review for the Copper Creek and Grizzly properties and compiled all available technical data“…(underlined part is our emphasis)…

The Grizzly and the Sheslay appear to be intimately connected, though Sheslay is much more advanced from an exploration standpoint…mark our words, the Grizzly will be key to Prosper Gold’s plans for the area – from both a geological perspective, and an industrial/infrastructure perspective…it’s interesting to note as well that Teck Resources Ltd. (TCK, TSX) has staked  ground right up to the southern border of the Grizzly over the past year…so Garibaldi has some powerful neighbors…

Historic opportunities have opened up on the Venture Exchange but investors must focus on companies and individuals with proven track records and the ability to execute both on the ground and in the market…that’s the only way to avoid deception and the money-sucking “lifestyle” companies that have infested the Venture like rats in recent years…a rising tide is not going to lift all boats this time…

There is no one who has established greater credibility in the junior resource sector over the last few years, in our view, than Pete Bernier…if you want to make money, follow those who have made it, still have it, and are growing it…Bernier and his award-winning geologist, Dirk Tempelman-Kluit, of course discovered the massive Blackwater Gold-Silver deposit in central British Columbia in 2009…as a result, Richfield Ventures, which we introduced to our readers when it was below $1 a share, got bought out by New Gold Inc. (NGD, TSX) in 2011 for $500 million…some of our readers made 10X their money…we’ve never seen an exploration play executed with such precision and professionalism as Blackwater under Bernier and Tempelman-Kluit, and there’s an excellent chance they’re about to pull off a repeat performance at Sheslay…Bernier has the exact same team with him at Prosper Gold, right down to the corporate secretary and the drilling company… 

While Bernier’s Prosper Gold remains halted pending approval (expected imminently) of the Firesteel transaction, investors can get a head start on what promises to be a very hot exploration play with Bernier’s new deal by taking a good look at Garibaldi…we did our due diligence which included a trip to the Iskut area, conversations with independent geologists and prospectors, and discussions as well with company management (Garibaldi and Prosper Gold)…

Garibaldi’s Grizzly Property is of major strategic value in the context of the Sheslay Project…investors have slowly been catching on to this in recent weeks, which is why volume in Garibaldi has picked up considerably…the share price is also firming up, and the stock’s 50 and 100-day moving averages (SMA’s) have reversed to the upside – a very bullish development…with working capital of 8 cents per share as of the quarter ending April 30, Garibaldi is in a healthy financial position – unlike most juniors – and has a very reputable management team led by President and CEO Steve Rogoci…

Because of its financial strength, GGI has not had to do a financing in over 4 years – and that was the cheapest financing they’ve ever done (12 cents)…no warrants are outstanding…there’s little overhead resistance or excessive amounts of paper that are going to hold this stock down…

Garibaldi not only controls 100% of the Grizzly Property, but they also have significant exploration assets in Mexico and other properties in British Columbia…it’s a year-round play which adds to its attractiveness…the company has been focusing almost entirely on its Mexican properties…but they are keenly aware of the quality and importance of the Grizzly Property, and our sense is that Garibaldi will bring the Grizzly out of “hibernation” very shortly…it’s in their strategic interest to do so…

As always, perform your own due diligence…you cannot beat the potential leverage investors have with some of these junior exploration plays, especially with the Venture at current levels…but common sense and wisdom are required in order to pinpoint the right deal(s)…we can sense where things are going in the Telegraph Creek area – northern B.C.’s next exploration hotspot…rather than follow the crowd, get in before the crowd…

Garibaldi 3-Year Weekly Chart Update

There are obvious technical signs that point to a very strong summer for GGI…note how the RSI(14) has broken above long-term resistance…GGI has also broken above a horizontal channel…sell pressure, dominant for a lengthy period, has just reversed to buy pressure…the ADX trend indicator is bullish, and the 50-day moving average (SMA) has also reversed to the upside…the 100-day SMA (not shown on the chart) is also now just starting to reverse…these are all classic signs of a pending bullish move, supported by developments on the ground…

Sego Resources Inc. (SGZ, TSX-V)

We’ll expand on this situation next week, but in the meantime readers may wish to perform due diligence on Sego Resources (SGZ, TSX-V) which is gearing up to commence drilling at its Miner Mountain Property just north of Princeton…this alkalic Copper-Gold porphyry prospect features at least 8 separate target zones worthy of further investigation through drilling and/or additional geophysics…in March of last year, DDH-21 returned a stellar 100.4 metres grading 0.95% Cu and 0.55 g/t Au…Sego just announced this morning that it has completed a $500,000 financing at 10 cents per share which followed a $130,000 private placement by insiders announced in June…below is a 2.5-year weekly chart from John…this one looks interesting…

Lakeland Resources Inc. (LK, TSX-V) Update

During the 2nd quarter, we introduced this company to our readers when it was trading around the 10-cent level…it’s a newly-formed pure uranium play focused on the Athabasca Basin in Saskatchewan and Alberta…again, we suggest our readers perform their own due diligence and we’ll expand on LK next week…the chart is promising as you can see below…

Note: John and Jon both hold share positions in GGI.  Jon also holds a share position in FTR.

Gold has traded between $1,274 and $1,290 so far today…bullion climbed as high as $1,300 yesterday morning after prepared remarks from Ben Bernanke were released and considered rather dovish, but bullion retreated once the Fed Chairman started testifying on the economy and monetary policy before the House of Representatives…Bernanke really didn’t say anything new, reiterating that the Fed expects to start scaling back its bond buying purchases later this year but this will hinge on economic developments…”Our asset purchases depend on economic and financial developments, but they are by no means on a preset course,” Bernanke said in his statement to the House of Representatives Financial Services Committee…Bernanke also emphasized that there could be a lengthy time-lag between the end of asset purchases and a hike in interest rates…the Fed Chairman speaks again today before a Senate Committee…

Traders hit the sell button on Gold yesterday when it couldn’t push through $1,300 and after Bernanke started speaking…some observers pointed out there may also be some limited producer hedging around $1,300…as of 7:45 am Pacific, bullion is up $11 an ounce at $1,285…Silver has added 15 cents to $19.44…Copper is flat at $3.11…Crude Oil has jumped $1.12 a barrel to $107.60 while the U.S. Dollar Index has gained one-quarter of a point to 82.94…

Holdings in the SPDR Gold Trust, the biggest Gold-backed exchange-traded product, fell to 936.07 metric tons yesterday, the lowest since February, 2009…prices may be near the bottom as demand in India and China, the largest consumers, is expected to exceed last year’s levels, according to Marcus Grubb, managing director of investment research at the World Gold Council (source: Bloomberg)….

Detroit Gears Up For Bankruptcy

The Wall Street Journal reported this morning that Detroit, America’s automobile capital and onetime music-industry powerhouse, could within days become the country’s largest-ever municipal bankruptcy case, people familiar with the matter said, as the city’s emergency manager accelerates his plan for restructuring nearly $20 billion of long-term liabilities…the expected bankruptcy filing would come after Kevyn Orr, the emergency manager, failed to reach agreements with enough of the city’s bondholders, pension funds and other creditors to restructure Detroit’s debt outside of court…Detroit has spent an average of $100 million more than it has taken in since 2008…most at risk under the expected bankruptcy case is the city’s $11 billion in unsecured debt…that includes almost $6 billion in health and other benefits for retirees; more than $3 billion for retiree pensions; and about $530 million in general-obligation bonds…

Today’s Markets

Asian markets were mixed overnight…Japan’s Nikkei average gained 193 points or 1.3% to close at 14809…China’s Shanghai Composite, meanwhile, fell 22 points to 2023…European shares are moderately higher in late trading overseas, while the Dow has hit a new record high this morning…through the first 75 minutes of trading, it’s up 99 points at 15569… the number of Americans filing new claims for jobless benefits dropped more than expected last week to its lowest level in four months, a possible sign that hiring could pick up in July…initial claims for state unemployment benefits fell by 24,000 to a seasonally adjusted 334,000, the Labor Department said this morning…the TSX is 95 points higher while the Venture has added 2 points to 913…

Prosper Gold-Firesteel Complete Definitive Agreement For Newly-Named Sheslay Porphyry Project

The starting gun is almost ready to go off near Telegraph Creek in northwestern British Columbia, an area that we believe will rapidly emerge as a powerful Copper-Gold exploration play…Prosper Gold Corp. (PGX.H, TSX-V) and Firesteel Resources Inc. (FTR, TSX-V) announced this morning that they’ve concluded a definitive agreement allowing Prosper Gold to earn as much as an 80% interest in Firesteel’s highly prospective Copper Creek Property which has been renamed the Sheslay Porphyry Project…

“Since the sale of our last company, Richfield Ventures in 2011, it has taken us two years to identify a multiple bulk tonnage Copper-Gold target area, with historical drill confirmed discoveries that met our exploration criteria for Prosper Gold,” stated Pete Bernier, the Company’s President and CEO…”The Sheslay Project area is close to infrastructure, drill permitted and drill ready…we look forward to advancing the project in the near-term“…

Fieldwork at Sheslay is anticipated to commence in the coming days and will include regional scale soil geochemistry, prospecting and trenching to be completed in association with a 12-square-kilometre detailed IP survey…a 5,000-metre Phase 1 drill program is scheduled to commence in early August…

BMR spoke with Bernier yesterday and we’ll have much more on the Sheslay Project Monday and the significance of Garibaldi Resources‘  (GGI, TSX-V) 17,000-hectare Grizzly Property which adjoins the western and southern borders of Sheslay…the heat source for the mineralizing fluids in the district may indeed originate in the northwest corner of the Grizzly with the Kaketsa Pluton, referenced in this morning’s news…it measures approximately 4 km by 5.6 km in surface extent…the Grizzly and the Sheslay appear to be intimately connected, though Sheslay is much more advanced from an exploration standpoint…mark our words, the Grizzly will be key to Prosper Gold’s plans for the area…

Propser Gold remains halted until final approval from the Exchange on its qualifying transaction with Firesteel…given the credibility and the efficiency of the Prosper Gold team, however, there’s every reason to believe that Exchange approval is imminent…

Firesteel Resources (FTR, TSX-V) Updated Chart

Keep a close eye on Firesteel which appears to have completed a normal retracement after climbing as high as 18 cents in the spring…FTR has generally been a light trader and closed at 8 cents yesterday, putting it well below major resistance which is in the 15-18 cent area as shown in John’s 15-year monthly chart below…Firesteel is also in the process of completing a definitive agreement with a subsidiary of OZ Minerals Ltd. of Australia for the ROK Coyote Property immediately south of Colorado Resources’ (CXO, TSX-V) discovery…

RedHill Resources (RHR, TSX-V) Stars Exploration Near North ROK

Redhill Resources Corp. (RHR, TSX-V) has commenced a program of soil sampling, geological mapping and geophysical surveying over the Yellow Chris South property near Iskut which it has optioned from from Teuton Resources Corp. (TUO, TSX-V)…Yellow Chris adjoins Colorado’s North ROK Property to the north and east, and is situated within a couple of kilometres from CXO’s discovery hole…Redhill closed yesterday at 3.5 cents and has 132 million shares outstanding…

Macro Enterprises Ltd. (MCR, TSX-V) Updated Chart

Actual earnings and earnings momentum with this company, as we’ve reported earlier…MCR has pulled back from an all-time high of $4.18 with the temporarily overbought condition unwinding as expected…below is a 1-year weekly chart…John’s looking for a “Wave 5” move, based on Fibonacci analysis, that could take MCR at least 50% higher from current levels…the fundamentals appear to support that…MCR closed yesterday at $3.55…

Medallion Resources (MDL, TSX-V)

Medallion Resources (MDL, TSX-V) has been a strong performer of late…the company announced earlier this month that it has signed an MOU with Arab Mining Company, a Jordan-based, pan-Arab mining industry investment firm…the MOU grants Arab Mining, for a period of 6 months, the exclusive right to negotiate terms to invest or participate in a joint venture, controlled and majority-owned by Medallion, which will focus on rare-earth production and processing opportunities within the Arab League nations, including a proposed rare-earth processing facility in Duqm, Oman…”Arab Mining has been assessing and investing in significant mining and mineral processing projects for almost 40 years, and brings to the venture an impressive track record and a dedicated development fund backed by shareholder’s equity of over $1.2-billion,” said Dr. Bill Bird, Medallion Chairman and CEO…”These resources, combined with Medallion’s expertise and industry contacts constitute the potential for establishing a significant rare earth value chain in the region…We look forward to realizing this vision with Arab Mining Company“…

MDL closed yesterday at 34 cents, which is double where it was about 2 months ago…long-term, this play could have excellent potential but investors should expect resistance around the Fib. level of 41 cents over the short-term, followed by a period of consolidation before possibly the next leg up…the long-term moving averages have all recently reversed to the upside, a very positive sign…as always, perform your own due diligence…

Note: Jon holds share positions in GGI and FTR.

Gold has hovered between $1,283 and $1,301 so far today, ahead of the start of 2 days of semi-annual Congressional testimony by Ben Bernanke…the Fed Chairman appears before the House today and the Senate tomorrow, and investors will be focusing on every word he speaks for more clues as to when the Fed may start scaling back its bond buying program…bullion has already gotten a lift after the release of prepared remarks from Bernanke (the bond buying program is “by no means on a preset course”)…he’s currently testifying, so expect jumpiness in Gold and perhaps the markets in general (up and down action) today and tomorrow…as of of 7:15 am Pacific, bullion is up $7 an ounce at $1,298…Silver is 11 cents higher at $20.12…Copper is off a penny at $3.15…Crude Oil is 24 cents lower at $105.76 while the U.S. Dollar Index is relatively unchanged at 82.62…

Some interesting comments from Gold Fields Nick Holland in an interview with Mineweb’s Geoff Candy (www.mineweb.com):

“The fundamentals that have underpinned the Gold industry over the last decade have not really changed, if you go and analyze them one by one, governments have been buying, the Chinese and the Indians have been the big source of demand and that will continue to be the case as the growth in those countries is far greater than anywhere else…Producer supply has declined, scrap sales are always a function of price, if the price pulls back the scrap comes off the market.  So we could well be heading again for a deficit in the Gold industry and that would help to underpin prices but sentiment is obviously driving these markets more than the fundamentals and sentiments can change positively and negatively very quickly.  So I don’t think Gold at all has lost its benefit in the portfolio and any investor, in my humble view, should have some Gold exposure in their portfolio because how confident are you of the values of the other asset classes you have.  Watch out over the next five to ten years  – we are going to see a contraction in supply in the Gold industry from the plus-minus 68m ounces we’re mining now, I think it will be a lot lower in five years than that“…

Chanos:  China Credit Bubble Getting “Worse And Worse And Worse”

Closely-watched short-seller and hedge fund manager Jim Chanos, who has plenty of followers and detractors, told CNBC today that the credit bubble in China is “world class” and is getting “worse and worse and worse”…the deteriorating credit situation “has worked its way through things like steel, cement, and commodities globally,” Chanos stated in a “Squawk Box” interview from New York…

Today’s Markets

Asian markets were mixed overnight…Japan’s Nikkei average rose slightly, climbing 16 points to 14615…China’s Shanghai Composite broke a brief winning streak, falling 20 points to 2045 despite some upbeat economic data…foreign direct investment in June surged over 20% from a year ago, a huge increase from May’s 0.3% annual gain…meanwhile, China’s holdings of U.S. Treasurys climbed to a record high in May despite a broad sell-off in U.S. government debt…China, the biggest foreign holder of U.S. sovereign bonds, raised its holdings of U.S. government debt by $25.2 billion to $1.316 trillion, according to the Treasury Department international capital (TIC) data published late yesterday…European shares are up slightly in late trading overseas…in New York, as earnings season and the Bernanke Watch continue, the Dow is up 24 points through the first 45 minutes of trading…the TSX is 68 points higher while the Venture has gained 2 points to 913…the next resistance level for the Venture is around 920…one of our readers asked this morning, has a final bottom been put in at 860?…too early to tell, of course, but the conditions seem ideal for a strong 3rd quarter…

Probe Mines Ltd. (PRB, TSX-V) Update

One of the best Gold exploration stories in Canada at the moment, in our view, is the success Probe Mines (PRB, TSX-V) is enjoying with its growing Borden Lake deposit in northeastern Ontario…we’ve been following developments there closely for more than a year, and John’s recent charts showed very strong technical support around the $1.50 level which held…Probe’s drilling focus has shifted shifted entirely to the important high-grade Gold zone discovered in the southeast, with all 4 drills on the property working in that promising area on expansion and infill drilling…Probe’s aim is to include as much of the new high-grade mineralization into an updated NI-43-101 resource estimate later this year…Agnico Eagle recently grabbed a nearly 10% position in PRB, and the major appears to be a logical candidate for a potential takeover of Probe within the next 12 months…PRB climbed 11 cents yesterday to close at $1.85…the EMA(20) is now at $1.61, which is strong new technical support, while the Fib. target (no timeline) in the 2.5-year weekly chart below is just under $3…that’s not a price target, as we don’t give those, but a theoretical level based on Fibonacci and technical analysis…as always, perform your own due diligence…Zenyatta Ventures (ZEN, TSX-V) is looking great in northern Ontario with its graphite deposit, but Gold enthusiasts need to be keeping a close eye on Probe as it could quickly develop into a star performer during the 2nd half of this year…lots of money in the treasury, and a very strong management and exploration team…PRB is off a nickel at $1.80 in early trading…

Paramount Gold & Silver (PZG, NYSE)

Nice intercept reported yesterday by NYSE-listed Paramount Gold & Silver (PZG, it also trades lightly on the TSX under the same symbol) from its Sleeper Project in Nevada – 305 metres grading 1.08 g/t Au and 10.5 g/t Ag…the hole cut across the zone at an oblique angle, so the true width of mineralization is estimated by Paramount to be approximately 150 metres…nonetheless, that’s still an exceptional result for this area and the best hole Paramount has ever drilled at Sleeper…2 other holes reported yesterday also returned long intercepts with average values well above the cut-off grade…more results are pending, and the exploration upside is still immense…the PEA that was released on the Sleeper last year showed robust economics at an average Gold price of $1,384 with an IRR of 26.8%…the base-case scenario incorporates an 81,000-tonne-per-day operation (approximate 30-million-tonne-per-year throughput), resulting in a projected 17-year operation with average annual production of 172,000 ounces of Gold and 263,000 ounces of Silver…projected life-of-mine average cash operating costs are $767 (U.S.) per ounce of Gold-equivalent recovered…start-up capital costs for this project scenario are estimated at $346-million…the past producing Sleeper Mine was one of the world’s lowest cost producers…SRK Consulting has been commissioned to update the Sleeper resource estimate to incorporate data from 44 new drill holes totalling over 15,000 metres completed since the resource estimation used in last year’s PEA…Paramount also holds the San Miguel Project in Mexico which boasts measured, current and indicated resources of 100 million ounces of Silver and 1.5 million ounces of Gold…

Paramount obviously offers excellent leverage to higher Gold and Silver prices, and so far the 3rd quarter is looking quite promising for a rebound in those metals…by the way, Garibaldi Resources (GGI, TSX-V) holds approximately 2.5 million shares of Paramount which originated from a deal between the companies 4 years ago on a Mexican property adjacent to San Miguel…below is a 2.5-year weekly PZG chart from John…RSI(14) is moving up from a bullish low “W”…PZG climbed 11 cents to close at $1.39 on the NYSE yesterday, and it’s edging higher in early trading today…

More Good Exploration News For British Columbia

Copper Fox Metals Inc. (CUU, TSX-V) has formed a joint venture with Teck Resources Ltd. (TCK, TSX) to further explore and develop the Schaft Creek project in northwestern B.C., an agreement that replaces and supersedes the 2002 option and joint venture deal between the 2 companies with respect to Schaft Creek…10,000 metres of diamond drilling, aimed at increasing the value of the project, is also expected to commence before the end of this month…CUU jumped nearly 30% yesterday (21 cents) to close at 80 cents on volume of more than 3 million shares on the news…as of 7:15 am Pacific, CUU is down 3 pennies at 77 cents…

Fission Uranium (FCU, TSX-V) Updated Chart

It should be an exciting summer for the Patterson Lake South (PLS) project now being drilled again by partners Fission Uranium (FCU, TSX-V) and Alpha Minerals (AMW, TSX-V)…with regard to Fission, one of John’s recent charts showed an excellent entry point around 70 cents at the bottom of an upsloping channel…yesterday, FCU jumped 8 cents on volume of more than 2 million shares to close at 88 cents…you may recall, and it’s shown again in this chart, the Fib. level John gave was 92 cents…resistance can be expected at this level, and the stock could take a short “breather” and consolidate after reaching this price, but by no means is he implying that FCU might be topping out…in fact, the next Fib. level (not shown on this particular chart) is $1.31…as of 7:15 am Pacific, FCU is unchanged at 88 cents…

Pacific Potash Corp. (PP, TSX-V)

Continue to keep a close eye on Pacific Potash (PP, TSX-V) which remains one of our favorites…excellent liquidity in the stock, and management has shown the ability to execute in every way so far…interest should pick up even more as drilling commences…the technicals are looking very strong with a cup-with-handle formation in its final stage…below is a 2.5-year weekly chart…as of 7:15 am Pacific, PP is up half a penny at 17 cents…

Note: John, Terry and Jon do not hold positions in PRB, PZG, or FCU.  Jon holds a share position in PP (John and Terry do not).

Gold has traded between $1,278 and $1,297 so far today…Gold watchers (and all investors) will be paying close attention tomorrow as Federal Reserve Chairman Ben Bernanke appears before the House of Representatives where he will report on U.S. monetary policy and the economy…as of 7:50 am Pacific, bullion is up $10 an ounce at $1,293…Silver is up 8 cents to $20.01…Copper has added 3 pennies to $3.16…Crude Oil has is off 12 cents to $106.20 while the U.S. Dollar Index has given up more than one-third of a point to 82.71…

As John’s Gold chart showed yesterday, an important resistance band the yellow metal needs to overcome is between $1,320 and $1,350…

When the herd is racing in the same direction in a particular market, when sentiment is overwhelmingly bullish or bearish, this is always the best time to either lock in profits or scoop up bargains…look at the chart below from Bloomberg which tracks the short positions in Gold for the “speculators” (not the commercial traders, who have been dramatically scaling back their short positions)…at the beginning of this month, the number of outstanding Gold short contracts was close to 140,000 – a record high…

As Frank Holmes commented in his Investor Alert over the weekend (www.usfunds.com):  “While I was on CNBC’s Squawk Box, Howard Ward, the chief investment officer of GAMCO Investors, made a bullish call based on the severity of the speculative short position:

“It was off the charts, just like it was a week ago for the short position and the yen, the pound and euro. Well, we’ve seen what happened to that. You wanted to be on the other side of that trade. I’ll take the other side of the Gold trade as well. Whenever so many people are on one side, I will take the other side. I think Gold probably rallies between here and the end of the year.”

U.S. Dollar Index Updated Chart

Bernanke’s dovish comments last week took the wind out of the sails of the greenback, at least temporarily, and perhaps that was his intention as the U.S. Dollar Index was threatening to push through 85 with strong momentum…it quickly went into reverse but found support just above 82.5…overall, the trend remains bullish and it’ll be quite fascinating to see how the greenback performs during this last half of the year (and tomorrow when Bernanke testifies before the House)…can the Dollar Index and Gold move in tandem?…yes, this has occurred at times in the past, but Gold (and the Venture for that matter) have generally performed much better when the greenback is weak…below is a 6-month daily chart from John…

CNBC reported this morning that fund managers are more bullish on the dollar than ever before, with a record number expecting the greenback to strengthen in the next 12 months, according to a new survey…a monthly poll from Bank of America Merrill Lynch showed that a net 83% of fund managers worldwide expect the dollar to appreciate in the next 12 months…this is a new record, breaking a previous record set in March when 72% of respondents forecast the dollar would rise over the following year…

Today’s Markets

Trading resumed in Japan after yesterday’s public holiday, and the Nikkei climbed 93 points overnight to close at 14599…China’s Shanghai Composite was up 6 points to 2066…European shares are off modestly in late trading overseas, thanks in part to disappointing economic sentiment data out of Germany…in New York, through the first 80 minutes of trading, the Dow is down 3 points at 15481…a slew of economic data out of the U.S. this morning…homebuilder confidence jumped in July to its strongest level since January, 2006, according to the National Association of Home Builders…the NAHB/Wells Fargo Housing Market index rose to 57 from a revised 51 in June…meanwhile, industrial production edged up 0.3% in June after an unchanged reading in May, according to the Federal Reserve…economists polled by Reuters had expected a gain of 0.2%…other numbers released this morning included consumer prices which posted their sharpest rise in 5 months in June…they advanced a seasonally adjusted 0.5%, thanks in part to a jump in gasoline prices…the TSX is off slightly as of 7:50 am Pacific while the Venture has gained 6 points to 903, the first time the Index has been above the 900 level in nearly a month (June 20)…

Updates On 3 Interesting Charts

There are about 2 dozen situations we’re looking at intensely at the moment that we would describe as having “superior” or unusual potential for the 3rd and 4th quarters of 2013, and these include GoldQuest Mining (GQC, TSX-V) and 2 other companies we haven’t mentioned for probably a few weeks – Aldrin Resource Corp. (ALN, TSX-V) and Amarc Resources (AHR, TSX-V…if you haven’t performed any due diligence on Aldrin or Amarc, we suggest you do…

GoldQuest, of course, has been a long-time BMR favorite for the potential of its land package in the Dominican Republic…initial assay results from drilling along the very prospective Guama trend, west of the Romero discovery, should be on the way soon…we like what the GQC chart is saying because there’s certainly a bullish undertone to it…below is a 2.5-year weekly chart from John…notice how the RSI(14) started trending higher in April…as of 7:50 am Pacific, GQC is down a penny at 45 cents…

Aldrin Resource Corp. (ALN, TSX-V)

Aldrin’s Triple M Uranium Property totals 120 sq. km, and is 9 km south to 11 km west of the Patterson Lake South (PLS) discovery…this chart is very interesting as it shows a cup-with-handle pattern in its final stages, combined with a long-term down trendline just a penny or so above the current price…it’s reasonable to expect a breakout above the top of the cup and the down trendline this summer…ALN closed yesterday at 10 cents…

Amarc Resources Ltd. (AHR, TSX-V)

British Columbia is going to be an exploration hot spot this summer, and Amarc Resources (AHR, TSX-V) is in an excellent position to benefit from that as we’ve mentioned on several occasions the last few months…below is an updated chart from John…the stock has formed a strong base around 5 cents…

Note: John holds a share position in AHR.  Jon holds a share position in GQC.