BullMarketRun.com

Gold has traded between $1,655 and $1,673 an ounce so far today…as of 7:15 am Pacific, the yellow metal is off $8 at $1,659…the biggest sale of exchange-traded products in three weeks signaled slowing investor demand in Gold even with a weakening U.S. dollar…ETP holdings of Gold dropped almost 5 metric tons, or 0.2 percent, yesterday, the most since Jan. 3, and heading for the first monthly drop since July (just prior to Gold taking off to the upside), according to data of exchanged traded funds and other products compiled by Bloomberg…Silver is down 24 cents at $31.38…Copper is flat at $3.65…Crude Oil is up 19 cents at $96.14 while the U.S. Dollar Index is down one-third of a point at 79.71…

Euro Zone Shows More Signs of Stabilizing

The European Central Bank said banks will next week repay more of its emergency three-year loans than economists forecast in another sign the euro region’s debt crisis is abating…some 278 financial institutions will return 137.2 billion euros ($184.4 billion) on Jan. 30, the first opportunity for early repayment of the initial three-year loan, the ECB said in a statement today…that compares with the median forecast of 84 billion euros in a Bloomberg News survey of economists…the ECB’s first loan totalled 489 billion euros and banks can continue to make early repayments in coming weeks…the ECB is taking back some of the extra liquidity it injected into the banking system a year ago in stark contrast to other central banks like the Federal Reserve and the Bank of Japan whose balance sheets are still blowing up…the euro gained half a cent on the news and is now sitting at $1.34, its highest level since February of last year…the ECB flooded financial markets with two tranches of so-called Longer Term Refinancing Operations totaling more than 1 trillion euros a year ago after banks stopped lending to each other because of Europe’s debt crisis…banks have the option of repaying the loans, which were offered at the average of the ECB’s benchmark rate over their duration, after a year…

Meanwhile, German business confidence rose for the third month in a row in January and hit a seven-month high, boosting the DAX index to its highest level since January, 2008…”The recent surveys add to growing signs that the German economy is turning a corner after a sharp contraction at the end of last year, and a strong rebound should be underway,” Barclays said in a research note…

Today’s Markets

Japan’s Nikkei climbed sharply overnight (nearly 3% to close at 10927) after the U.S. dollar posted its biggest one-day rise against the Japanese yen since October, 2011…the yen’s weakness follows comments from Japanese Vice Finance Minister Takehiko Nakao who indicated in an interview with The Wall Street Journal yesterday that “appropriate action” would be taken if the Japanese currency resumed its strengthening trend…China’s Shanghai Composite fell 11 points to 2291…European shares are in the green today, led by Germany, while North American markets are also positive…the Dow is up another 34 points, the TSX has gained 17 points while the Venture is up a point at 1230…

Canadian Dollar Chart Update

Surprisingly, the Canadian dollar has been showing some technical weakness recently, and a test of the 99-cent support level seems very possible in the near future before a rebound can be expected…the 100-day moving average (SMA) has also reversed to the downside which is creating some additional pressure…the Venture Exchange performs best when the commodity-sensitive Canadian dollar is showing upside momentum, so this in part helps explain the difficulty the Venture has been having in breaking through the 1240 resistance area…overall, the dollar is still very healthy from a technical standpoint and its current softness appears temporary…below is an updated 3-year weekly chart from John…

Parlane Resource Corp. (PPP, TSX-V)

As we reported Tuesday, Parlane Resource Corp. (PPP, TSX-V) has made an important discovery of Gold and Silver mineralization at its Big Bear Project in the Blackwater district of central British Columbia in a hole that’s right on strike with New Gold Inc’s (NGD, TSX) Blackwater and Capoose deposits…PPP climbed as high as 31 cents intra-day Monday, after five previous straight “up” days, so a technical pullback to unwind overbought conditions was not surprising…sure enough, the stock closed at Fibonacci support of 21 cents yesterday and has started to climb higher again this morning…what’s so unique about this situation is that for infrastructure reasons alone, New Gold Inc. needs Parlane’s large land package in our view – so a takeover of PPP at some point down the road seems inevitable…geologically, Big Bear could be an extension of the Blackwater deposit, or a skarn that feeds into it, based on Parlane’s initial results…we expect Parlane to get very aggressive with a second round of drilling in the spring to follow-up on the Phase 1 discovery…for all of the above reasons, the upside potential of this play far exceeds the downside risk in our view…as always, perform your own due diligence…

Atico Mining Corp. (ATY, TSX-V)

Atico Mining (ATY, TSX-V) reported impressive drill results yesterday from its El Roble underground copper and Gold mine in Colombia with the discovery of a new massive sulphide body at the north end of known mineralization…hole ATDHR-26 intersected 119.70 metres grading 6.89% Cu, 6.26 g/t Au and 16.50 g/t Ag…mineralization now extends 360 metres along strike and 250 metres below the 2000 level, the lowest production level at the mine…so this is a deep system but the grades are good…ATY announced January 16 that it had completed an $8 million private placement at 65 cents…the stock closed up 29 cents at 95 cents yesterday after hitting an intra-day high of $1.01…some consolidation can often occur after a move like yesterday, but this is definitely a situation to watch closely…there is strong technical support between 71 cents and 80 cents, the 2012 high…ATY is off a nickel to 90 cents in early trading today…as always, perform your own due diligence…

Note:  John, Jon and Terry do not hold share positions in ATY.  Jon holds a position in PPP.