BullMarketRun.com

1. Gold has traded between $1,254 and $1,265 so far today…as of 7:00 am Pacific, bullion is off $6 an ounce at $1,259…the fact that Gold has not been moving higher despite weakness in global equities and a rather restrained dollar in recent sessions has prompted stale longs to exit their positions, putting additional downward pressure on the metal…much of the action in bullion at the moment is technically-driven with astute traders looking for a bottom somewhere between $1,230 and $1,240…later today we’ll be posting an updated chart on Gold in Canadian dollars, a chart that has served as an extremely reliable guide in recent years…Silver has slipped 4 cents to $16.26…Copper is off 3 pennies at $3.04…Nickel is steady at $6.64…Zinc is off a penny at $1.31 while Cobalt is down slightly at $35.83…Crude Oil has strengthened 47 cents to $68.55 while the U.S. Dollar Index has slipped more than one-tenth of a point to 94.39…the 95 area continues to provide stiff resistance as expected…

2. Gold-backed ETF’s tracked by Thomson Reuters are headed for their weakest month since July 2017, which proved to be an ideal time to be a buyer of the precious metal…total holdings for the 12 Gold-backed ETFs tracked by Reuters were down 3% from 57.8 million ounces last month to 56.2 million by Friday…that would be the largest monthly outflow for Gold-backed ETFs tracked by Reuters in almost a year…

3. Bart Melek, head of commodity strategy with TDS and one of the industry’s top Gold forecasters, has this to say about bullion at the moment:  “Given the recent equity-market correction and talk of a trade-driven slowdown in the global economy, it is likely that the market will start to get a lot less enthusiastic about aggressive Fed tightening and the U.S. dollar.  In addition, the yield curve and rates across the curve are falling, which decreases both carry and opportunity cost, while risk of sentiment should see investors start returning to the paper Gold market.”  Meanwhile, bullish positioning by speculators fell sharply in the most recent report from the Commodity Futures Trading Commission.  “With low long positioning and risk reversals starting to move convincingly towards puts, even a modest risk that a trade war may materialize, a weaker U.S. dollar or Fed statements walking back from aggressive hike rhetoric have the potential to very quickly spike Gold into the $1,300’s,” Melek concludes…

4. The latest in a series of operational and reliability problems at the giant Syncrude Oil sands facility in Fort McMurray is taking production off the market, giving Oil prices some unexpected support following Friday’s OPEC meeting in Vienna…the company says production of upgraded bitumen could remain offline through all of July…the stoppage was caused by a power outage last week…however, these problems should free up much-needed pipeline space out of Western Canada and also strengthen prices for Canadian heavy Oil…the “differential” (the difference in price between Western Canadian Select bitumen blend Oil versus New York-traded WTI) spiked at about $30 U.S. per barrel in February, fell to the high teens in April and May as Oil sands projects went through maintenance shutdowns, but rose again in the past few weeks as output again filled pipelines…the differential is now in the mid-$20’s…Canada urgently needs increased pipeline capacity but governments are all talk, no action, and of course the B.C. government is actively working against expansion of the now-nationalized Trans Mountain pipeline…this is a very different Canada today…

5. The Dow is trying to rebound after 9 losing sessions out of 10...as of 7:00 am Pacific, the index is up 50 points…Netflix (NFLX, NASDAQ) fell 6.5% yesterday, its biggest single-session drop since July 2016…the stock is still up roughly 100% this year…in Toronto, the TSX has added 44 points while the Venture has hit a fresh yearly low of 746…one Gold stock that continues to buck the trend is Wesdome Gold (WDO, TSX) which released more high-grade results this morning that extend the Kiena Deep”A” zone over 350 m along strike…it remains open along strike in both directions and downdip…drilling continues with 3 rigs…multiple new high-grade lenses have been intersected, including 77.4 g/t Au over a 14.4-m core length…WDO is up 16 cents at $3.06 through the first 30 minutes of trading…Tidal Royalty (RLTY, CSE) began trading on the CSE yesterday as the latest marijuana listing…it closed at 70 cents on its first day and remains at that level this morning…the company provides expansion financing to licensed U.S. operators across multiple verticals, including cultivation, processing and manufacturing, dispensing, and ancillary services…Tidal Royalty was founded in August 2017 by experienced cannabis industry executives, including CEO and Chairman Paul Rosen who’s the co-founder and former CEO of PharmaCan Capital, now operating as Cronos Group (CRON, TSX, NASDAQ)…

6. Large Canadian cannabis producers will be allowed to start growing outdoor crops immediately…until now, licensed producers of medical cannabis have grown their crops in greenhouses and indoor facilities…when the recreational market opens in mid-October, the only legal supply of cannabis will come from these facilities, where security is tight, the environment is controlled and every interaction with a plant is recorded on video…however, new regulations Ottawa is expected to unveil this week will open the door to commercial outdoor cultivation…while it’s too late in the production cycle in most of the country to start outdoor cultivation this year, the new rules will be in place for next year’s production season…Ottawa had required medical marijuana to be grown indoors to prevent theft and to ensure that the product met standards established by Health Canada to keep it free of dangerous chemicals, mould and mildew…allowing outdoor cultivation is the latest example of federal rules being modified to help new producers enter the recreational market…

7. While Canada continues to put up barriers to fossil fuel development, the United States has become the world’s biggest Natural Gas producer, one of the top Crude Oil producers, and a growing exporter of both…today, Energy Secretary Rick Perry spoke at the opening ceremony of the triennial World Gas Conference and referred to a surge in U.S. fossil fuels production over the past several years that has been made possible, in part, by advanced hydraulic fracturing drilling technology.  “We are bearing witness to this astonishing energy miracle.  But this is not just about exporting our energy bounty, it is about exporting the technology, the know-how, that unleashed our bounty in the first place,” he added…the International Energy Agency expects global Gas demand to grow an average of 1.6% per year over the next 5 years, with Chinese consumption leading the way, according to the latest forecast released this morning…

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