BullMarketRun.com
Gold has traded between $1,335 and $1,350 so far today…as of 10:15 am Pacific, bullion is down $9 an ounce at $1,336…Silver has retreated 22 cents to $19.53…Copper is up a penny at $2.11…Crude Oil has surged nearly $2 a barrel to $47.35 while the U.S. Dollar Index has reversed higher, adding more than one-tenth of a point to 95.11 (don’t trust that rally!)…
Holdings of SPDR Gold Trust, the world’s largest Gold-backed exchange-traded fund, fell slightly to 951.81 tonnes yesterday
The ECB left interest rates unchanged today (no surprise) and maintained the key parameters of its 1.74 trillion euro ($1.95 trillion) asset buying program as it seeks to revive growth and inflation…there were expectations that the central bank might announce the extension of the program beyond its current deadline of March 2017, but it did not do so this morning (that’ll come later, we’re sure)…
Meanwhile, the ECB slightly lowered its economic and inflation projections for next year. “We will preserve the very substantial amount of monetary support that is embedded in our staff projections and that is necessary to secure a return to inflation,” ECB President Mario Draghi declared in a statement…
The Bank of Canada, meanwhile, admits that its inflation expectations are falling short…the central bank kept interest rates unchanged yesterday and said that risks to the country’s inflation profile had “tilted somewhat to the downside” in the 8 weeks since its last set of forecasts…that was a departure from previous statements that described inflation risks as “roughly balanced”…the BOC added that “global growth in the first half of 2016 was slower than the bank had projected in its July Monetary Policy Report, although the bank continues to expect it to strengthen gradually in the second half of this year.”
Oil Update
Oil prices have pushed significantly higher today, and Oil stocks are of course benefiting, after back-to-back reports of a big drop in U.S. Crude inventories…the latest report came this morning from the U.S. Energy Information Administration (EIA) which stated that inventories fell by 14.5 million barrels in the last week compared with expectations for an increase of 225,000 barrels…
U.S. industry data yesterday also showed a large drawdown in Crude stocks, reflecting the temporary impact of an Atlantic storm…
Oil is also getting a lift from robust Chinese trade data…China’s Crude imports in August surged by nearly a quarter from a year ago to the second-highest amount ever…
Drilling activity in Canada’s Oilfields has slowed to the point that 2016 will be the worst year on record for the industry, according to the Canadian Association of Oilwell Drilling Contractors (CAODC)…the group’s updated forecast for the 4th quarter shows a 25% drop in new Oil and Gas wells drilled from its original forecast in November…it also shows that an average of only 140 rigs were put to work during the course of this year, which is 31% lower than the 204 rigs the CAODC initially forecast…
In Today’s Morning Musings…
1. Orex Exploration (OX, TSX-V) brings Goldboro Gold Project out of hibernation…
2. Arizona Mining (AZ, TSX) drills 105 feet of 13.7 % Zn, 10.3% Pb, 0.30% Cu and 3.4 opt Ag at Taylor deposit within a 505-foot intersection…
3. Rockhaven Resources (RK, TSX-V) drills into high-grade Gold more than 1 km south of Klaza Project resource…
4. NuLegacy Gold (NUG, TSX-V) jumps on Nevada results…
5. MX Gold (MXL, TSX-V) overcomes environmental hurdle at Willa…
6. Transition Metals (XTM, TSX-V) – an up-and-comer among project generators…
Gold has traded between $1,342 and $1,353 so far today…as of 9:00 am Pacific, bullion is down $7 an ounce at $1,342…Silver has retreated 33 cents to $19.71…Copper is up a penny at $2.10…Crude Oil is 52 cents higher at $45.35 while the U.S. Dollar Index, after a rough day yesterday, has recovered more than one-tenth of a point to 94.98…
Gold surged 1.7% yesterday, the biggest single-day gain since the results of the Brexit vote on June 24…
Holdings of SPDR Gold Trust, the world’s largest Gold-backed exchange-traded fund, rose 1.52% yesterday in the biggest one-day jump since July 5…
China’s Gold reserves rose to 58.95 million ounces at the end of August from 58.79 million ounces at the end of July, the country’s central bank confirmed today…
Goldman Sachs‘ economists have suddenly stepped back from their bold call for a Fed rate hike this month…they lowered the odds this morning for a September rate hike to 40% (still astonishingly high) from 55% – the latter a call they made Friday even after the tepid August jobs report convinced many that the Fed was not likely to move soon… what’s with these economists?…
According to Fed funds futures tracked by Bloomberg, odds of the Fed raising rates this month slid to 24% as of yesterday (still 24% too high) from 34% at the start of September…U.S. services sector activity slowed to a 6.5-year low in August, according to fresh data released yesterday, amid sharp drops in production and orders, pointing to slowing economic growth that further diminished prospects for a near-term interest rate increase…
Still, Fed Bank of San Francisco President John Williams painted an upbeat picture of the U.S. economy in a speech yesterday, saying it made sense to get back to a pace of gradual rate increases, “preferably sooner rather than later,” he said…a few weeks ago, in his regional Fed bank’s Economic Letter, Williams noted, “There is simply not enough room for central banks to cut interest rates in response to an economic downturn…”
Is that why certain members of the Fed are in a “hurry up” mode when it comes to additional rate hikes?…are they afraid a recession might come sooner than expected, leaving them with very little wiggle room to tackle an economic downturn – unless of course they adopt a negative interest rate policy as in other parts of the world?…
In Today’s Morning Musings…
1. Sudden $2.2 million financing at 12 cents August 25, 86 m @ 1.1% Cu September 7…
2. 34 m @ 35% Zinc – why did that have to be on the doorstep of ISIS?…
3. TSX Gold Index – embrace any weakness!…
4. Daniel’s Den – more on Zinc with 3 high-quality stocks in that space…
Short for financial technology, “Fintech” is an innovative industry composed of companies that use technology and software to make financial services more efficient.
According to Accenture, global investment in financial technology increased more than 12-fold from $930 million in 2008 to more than $12 billion in 2014.
On June 19, in a popular article titled “Bank of America Closed 900 Locations Due to This Technology“, we highlighted Mitek Systems (MITK, NASDAQ) as an emerging superstar and pure play on financial technology.
Since then MITK has appreciated by 15%.
We are bringing it to your attention again today because new subscribers may have missed the story and some who read it may have under-appreciated how valuable Mitek’s technology is (and how intertwined it’s becoming with mobile commerce).
Click here to quickly become a BMR subscriber and read the rest of this update on Mitek including an exclusive BMR chart that shows how high this stock may climb over the short-to-medium term, or login with your username and password…
The resource section of the BMR Top 50 Opportunities List unveiled in early December 2015 is up an impressive 185% in 9 months (247% annualized return) with two-thirds of those 39 picks posting triple-digit percentage gains.
This compares to a 57% advance for the Venture and a 22% climb in Gold during the same period. The TSX is up 11% since then, the Dow has advanced 3.6% while the NASDAQ is up slightly.
Individual category performances (comprising 50 stocks) are as follows:
PRODUCERS: Up 129%
NEAR-PRODUCERS: Up 198%
EXPLORERS: Up 186%
EXPLORER SLEEPERS UNDER A NICKEL: Up 284%
NON-RESOURCE: Up 26%
In tonight’s report is an updated performance review of each category through September 2, and comments on the best opportunities entering what should be a bullish final 4 months of 2016. During bull market years since 2003, the Venture has finished December an average of nearly 30% above its August close. Prices are up significantly over the last 7 months but they are going to go higher, and many stocks that haven’t moved much yet will start to join in.
Overall, 40 or 80% of the 50 picks have increased in value while 10 are down. Seventeen stocks out of 50 (34%) have surged 200% or more. The average return so far for all 50 companies is 150% or 200% on an annualized basis.
Pure Gold Mining (PGM, TSX-V), which released more high-grade drill results from its Madsen Project this morning, tops the list with a gain of 529% followed by Cordoba Minerals (CDB, TSX-V) at 515%, Lithium X Energy (LIX, TSX-V) at 468%, Kiska Metals (KSK, TSX-V) at 467%, Brazil Resources (BRI, TSX-V) at 413% and Gold Standard Ventures (GSV, TSX-V) at 345%.
Not included in the above statistics are the 49 recent additions (New Additions), companies that have been added at various times since late February – most of them in just the last few months. Combined, this group is already up 43% with Heart of Gold Camp leader Colorado Resources (CXO, TSX-V) setting the pace with a gain of 262%. The company expanded its drill program at KSP after hitting high-grade intercepts in two-thirds of its first 30 drill holes at the Inel zone including 25.7 m grading 9.2 g/t Au. CXO appears to have started a new uptrend after retracing to just below its rising 100-day moving average (SMA) last week.
BMR recently correctly predicted potential takeovers of both Dolly Varden Silver (DV, TSX-V) and Homestake Resource (HSR, TSX-V), up 244% and 64%, respectively, since we broke the story June 7 (click here) about Hecla Mining (HL, NYSE) purchasing 600 sq. km of claims in the Kitsault district (80 km SE of Heart of Gold Camp) near DV and HSR from a private group. Homestake is being acquired by Auryn Resources (AUG, TSX-V) while Dolly Varden has raised $7.2 million to become debt free and fend off a hostile takeover bid (at least for now) by Hecla.
Almadex Minerals (AMZ, TSX-V) soared 134% in August on a drilling discovery at its El Cobre Cu-Au Porphyry Project in eastern Mexico. AMZ closed at 95 cents today and has only 44 million shares outstanding. Meanwhile, Lion One Metals (LIO, TSX-V) has been trading near multi-year highs after announcing it has arranged a $41 million financing as well as a comprehensive engineering, procurement and construction package for the development of the company’s 100%-owned and fully permitted Tuvatu Gold project in Fiji. Also in Fiji, Thunderstruck Resources (AWE, TSX-V) is getting active and closed today at 12 cents.
Clean Commodities (CLE, TSX-V), formerly Athabasca Nuclear, has built a powerful Canadian clean commodity brand that includes a compelling package of recent Lithium property acquisitions, including a massive land package beside Nemaska Lithium (NMX, TSX) at Whabouchi, as well as strategic PGE, Uranium and Diamond properties. CLE’s large Labrador Trough Cu-Ni-PGE Project surrounds what could be an important drilling discovery-in-the-making at Northern Shield Resources‘ (NRN, TSX-V) Huckleberry Property.
Otis Gold (OOO, TSX-V), Battle Mountain Gold (BMG, TSX-V) and Purepoint Uranium (PTU, TSX-V) were all strong performers in August, climbing 50%, 49% and 31%, respectively. Otis and Battle Mountain are both in the midst of drill programs while NexGen Energy (NXE, TSX) has made a high-grade drilling discovery approximately 300 m south-southwest of PTU’s Hook Lake JV’s Spitfire mineralization.
1. The Norwegian central bank likes this emerging Heart of Gold Camp producer A LOT…
2. This Silver star under 60 cents jumped 10% today – a sign of things to come for both the stock and Silver…
3. The father-son team that’s making investors a lot of money…
4. Cashed up, under 10 cents, and time to accumulate before this Lithium-Cobalt play takes off…
Gold has traded between $1,326 and $1,345 so far today, getting a boost from more weaker than expected U.S. economic data…as of 9:30 am Pacific, bullion is up $16 an ounce at $1,343…Silver has shot up 34 cents to $19.85…Copper is flat at $2.09…Crude Oil has backed off 7 cents to $44.39 while the U.S. Dollar Index has been slammed, down more than three-quarters of a point to 94.92…the dollar bulls keep making the same mistakes (again and again and again)…
The Venture was up 54% for 2016 through last Friday vs. a 39% gain in Silver this year and a 25% advance in Gold…if that hasn’t been quite enough to scare off the dollar bulls, wait ’til they see what’s waiting for them just around the corner!…
Good contrarian sign – shifting interest rate expectations caused hedge funds to dump their bullish bets in Gold and Silver to a more than 2-month low in the week ending last Tuesday, according to the latest trade data from the Commodity Futures Trading Commission…
Despite Gold and Silver stocks being up over 100% in 2016, Sean Williams at Motley Fool says they can still be considered “value stocks”, particularly relative to the S&P 500…his analysis is based on price-to-cash flow per share ratio (P/CFPS)…currently, the S&P 500 is valued at 8.7 times P/CFPS (and generally speaking it is often between 10 and 20). “However, if you look at Gold and Silver stocks, you’ll find substantially cheaper alternatives on a price-to-cash flow per share basis,” Williams continues. “Especially after this last correction. In many instances, you can find mid-to-high, single-digit P/CFPS among Gold and Silver miners.”
Australia’s central bank held interest rates steady today, a month after cutting to a record low of 1.5%, and left open the question of further easing as the country gets ready to toast 25 years without a recession…
No change in European Central Bank (ECB) policy is expected on Thursday, but President Draghi’s news conference could provide insight to whether the ECB is considering any additional easing for the future…
Negative Interest Rates Until 2021?
ISM Non-Manufacturing Index Tumbles
The Institute of Supply Management reported this morning that its non-manufacturing index fell to 51.4 in August, well below expectations of 55 (the July reading was 55.5)…does anyone still believe the Fed will raise rates in a couple of weeks?…apparently, some Wall Street traders have been conned so good by the Fed, they still do…
Gold’s “Trump” Card
CNN (the Clinton News Network) must have had a hard time digesting this information this morning – a new CNN/ORC Poll shows a big change in the U.S. Presidential race with Donald Trump now leading Hillary Clinton by 2 points (45% to 43%) after Clinton was in the lead by a wide margin immediately following the Democratic Convention…
Libertarian Gary Johnson is at 7% among likely voters while the Green Party’s Jill Stein has just 2% support… independents are giving Trump a major boost – 49% say they’d vote for him while just 29% of independent voters back Clinton…
“Groupthink mentality”, always a red flag, has been assuming that this election is in the bag for Clinton…a much more uncertain outcome, in our estimation, will be yet another factor that will prevent the Fed from raising rates prior to the election…the prospect of a Trump victory should also be Gold-bullish (and dollar bearish) given the increased uncertainty it would create, politically and economically, particularly on the international stage…
Enbridge Acquires Spectra To Create North America’s Premier Energy Infrastructure Company
Enbridge (ENB, TSX), Canada’s largest pipeline company, said today it would buy Spectra Energy (SE, NYSE) in an all-stock deal valued at about $37 billion ($28 billion U.S.) to create the largest North American energy infrastructure company…Enbridge’s biggest-ever deal comes as the company has been steadily expanding its North American pipeline network, which carries the bulk of Canadian Crude Oil to the United States…
Oil Update
Saudi Arabia and Russia agreed yesterday to “cooperate” in world Oil markets, whatever that means, prompting a temporary jump in prices…however, the rally stalled after Saudi Energy Minister Khalid al-Falih said there was no need to freeze output for now (of course not, the Saudis are pumping Oil faster than rabbits can make bunnies)…
While the Saudi minister played down the prospect of imminent action, his Russian counterpart Alexander Novak said he was open to ideas on what cut-off period to use if countries chose to freeze output and even said production cuts may be discussed…Novak said the agreement was an “historical moment” between OPEC and non-members, and that the plan was to support the “stability of the Oil market…ensuring a stable level of investment in the long term”.
OPEC and non-OPEC producers such as Russia will hold informal talks in Algeria September 26-28, though many observers are skeptical that any kind a deal will materialize…
OPEC members pumped record crude in August…OPEC’s production increased by 40,000 barrels per day in August to 33.5 million barrels per day, setting a fresh output record, according to OilPrice.com…the unexpected increase from July’s record levels continues to jeopardize the stabilization of Crude prices, and suggests that the global Crude market remains oversupplied…however, spare capacity among OPEC members, especially Saudi Arabia, continues to decline…
In Today’s Morning Musings…
1. Gold and Silver shine as more U.S. economic data disappoints and the Dollar takes a dive…
2. Updated Venture and Silver charts you’ll love!…
3. Updates on some of today’s major movers and a few stocks that are about to move…
4. Daniel’s Den – print money and buy Gold stocks!…
BullMarketRun.com Special Feature
This article should help you with your near-term and longer-term trading/investment strategies as it takes you through 15 fascinating years of Venture history, and includes an amazing long-term chart from John, for clues as to how this month, and the balance of 2016 and the next year or two beyond that, are likely to unfold.
It was no surprise the Venture jumped 25 points or 3% to begin September last Thursday and Friday.
September has proven to be a POWERFUL month during Venture bull market years, and there’s no question we’re in a new bull market in 2016.
The evidence is overwhelming, which we’ll get into shortly.
Seasonality Chart
First, let’s take a look at the Venture “Seasonality Chart” going back 15 years. It’s rather deceptive, actually, as it shows September as the third worst month of the year in terms of its average return (-1.1%).
You’ll notice, however, that only February, October and December have produced more winning months than September!
Breaking It Down – September During Bull Market & Bear Market Years
The “Seasonality Chart” doesn’t really help us unless we separate the bull market years from the bear market years. That’s when it gets really interesting and guides us in terms of trading strategies, with at least one fact that’s sure to astonish you!
During BULL market years (2003, 2004, 2005, 2006, 2009 and 2010) the Index has gained an average of 6.2% in September. If you don’t include 2006, the average advance is 9.3%. In 2006, September was a disappointment (9.2% loss) but the market more than made up for that with a spectacular 21% surge during October, November and December.
Meanwhile, September during BEAR markets (2007, 2008, 2012, 2013, 2014 and 2015) has typically been very negative with an average decline of 5%, highlighted by the 11.2% drop in 2014 and the 29% thumping in 2008 as the global financial crisis took hold. 2007 (sort of a “hybrid” year, and 2012 were exceptions (September 2007, an 8.9% gain, featured the Noront Ni-Cu-PGE discovery while September 2012, an 11.2% advance, proved to be just a bear market rally out of oversold conditions).
Defining Venture Bull Market & Bear Market Years
John has divided Venture history into 6 distinct trading periods. We’re now in “Period 6” – a confirmed bull cycle that should last for at least a couple of years.
Period 1 (2001 into early 2003) is best described as “neutral” – mostly range trading as the Venture gauged developments including 9/11 and the war and recession that followed.
Period 2 (early 2003 to early 2007, a bull cycle) delivered a stellar return of 280%.
Period 3 (early 2007 to the end of 2008) was nasty – an 80% wipe-out thanks to the Great Crash.
The gain during Period 4 (2009 to early 2011, another bull cycle) was staggering, similar to Period 2 but over a shorter time frame, at 264%.
Period 5 (early 2011 to early 2016) was an ugly bear market as we all know, and the Venture declined a whopping 81% (same percentage decline but worse in many ways than Period 3 because it dragged on for 5 years).
If Period 6 is similar to Periods 2 and 4, we can expect the Venture to make its way to at least 1700 during this cycle.
Buy pressure is increasing rapidly. The 300-day SMA – not shown on the chart below – has reversed to the upside, while a bullish +DI/-DI cross has also just occurred. RSI(14) is surging, just like it did at the beginning of Periods 2 and 4. Note the critical breakout, as well, above the downtrend line.
All those signals confirm a new bull market.
This Is Even More Amazing!
Not only has September been strong 83% of the time during Venture bull market years, but keep these 2 important facts in mind:
The Venture’s August 31 close was 786. If this is just an average bull market year, we can expect the Venture to reach at least 996 in December which almost matches John’s next measured Fib. resistance for the Index (978)!
The trend is your friend.
Venture 16-Year Monthly Chart & Periods 1 Thru 6
Click here for the BMR Top Opportunities List – up 200% on an annualized basis in 2016, and more big winners on the way!
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