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Gold is firmer today after a weaker-than-expected U.S. jobs report…bullion fought back impressively yesterday to close just above the $1,550 support level, and as of 7:00 am Pacific it’s off its highs but still up $11 an ounce at $1,565 – about $27 above yesterday’s intra-day low…Silver has climbed 21 cents to $27.11…Copper is flat at $3.37…Crude Oil has fallen 97 cents to $92.29 while the U.S. Dollar Index has lost one-quarter of a point to 82.53…

U.S. March Jobs Report Disappoints

A rather ugly jobs report came out of the U.S. this morning with the economy creating just 88,000 positions, the smallest gain in 10 months and well below expectations of an increase between 150,000 to 200,000…the sequester and an unusually cold March in parts of the U.S. were likely contributing factors…the unemployment rate fell to 7.6%, but this was due to half a million people dropping out of the work force – not a good sign…there were job losses in both the retail and manufacturing sectors…offsetting some of March’s weakness, February payrolls were revised up to a gain of 268,000 from the originally reported 236,000, while January was revised to a gain of 148,000 from the previously reported 119,000…consistent month-after-month gains of 200,000 jobs or more will be required to seriously bite into the unemployment rate, and this will not come about just through loose monetary policy and a rising stock market but through smarter fiscal policy and Washington getting its act together…

Today’s Markets

The Dow has fallen 168 points to 14438 in the first 30 minutes of trading…in Canada, the TSX has lost 108 points to 12255 but the Venture is (encouragingly) bucking the trend (thanks to a rising Gold price) and has gained 2 points to 1029…on a closing basis, it held support yesterday at 1027…overseas, Japan’s Nikkei average topped the 13000 level intra-session overnight, hitting its highest levels since August, 2008, before trimming gains on profit taking to close up 199 points or 1.6% at 12834…the Bank of Japan yesterday unveiled radical measures to boost inflation and meet a 2% inflation target in two years…it plans to inject $1.4 trillion into the economy in less than two years, doubling the monetary base and buying government bonds of all maturities…the bank’s previous asset-purchase program had focused on buying bonds with a three-year maturity…European shares are down sharply, nearly 2%…retail sales fell in the 17 countries that use the euro in February (0.3% on the month and by 1.4% on the year as released by Eurostat this morning, the EU’s official statistics agency), underscoring the weakness in consumer demand that may delay an economic recovery leaders hope to see this year…the figures came a day after the ECB opted to keep its monetary policy stance unchanged despite continued weakness in the bloc’s economy, especially in the southern countries, such as Greece and Portugal, that are most deeply involved in its debt crisis…

Fed Has Exit Strategy In Mind For QE3

The U.S. Federal Reserve could adjust the pace of asset purchases to send a signal about its intentions, vice-chair Janet Yellen said yesterday as she became the latest senior official to hint at a slowing of QE3 – perhaps later this year, though of course she never gave any timelines (after this morning’s weak jobs report, the Fed will remain as supportive as ever through the spring and summer at least)…“In my view, adjusting the pace of asset purchases in response to the evolution of the outlook for the labor market will provide the public with information regarding the Committee’s intentions”, she told the Society of American Business Editors and Writers at a conference in Washington, DC…doing so “should reduce the risk of misunderstanding and market disruption as the conclusion of the program draws closer”, she said…Yellen is number two at the Fed and a likely candidate to succeed Ben Bernanke next year…

Long-Term Gold Chart

Gold continues to show resilience, and John’s 12-year monthly chart this morning puts the big picture into perspective…notice how RSI(14) is at an important support level after a consistent decline from when Gold hit an all-time high in the summer of 2011 at just over $1,900 an ounce…trading patterns over the last six quarters share some similarities to those in the year-and-a-half following the $1,000 peak in early 2008…

Richmont Mines (RIC, TSX) Update

Richmont Mines (RIC, TSX) was one of the top performers on the entire TSX in 2011 before crashing in 2012 in sympathy with the slide in the Gold stock sector in general, and due to operational problems at its Francoeur Mine and a disappointing PEA from the Wasamac Property where a substantial resource was outlined…a new CEO, Paul Carmel, took over the reigns last year and put the bad news behind the company and started the process of rebuilding…overlooked by the market during the big drop in the TSX Gold Index since the beginning of the year are impressive results from Richmont’s producing Island Gold Mine near Wawa, Ontario, where RIC has outlined a high-grade, deeper resource that is still open in all directions…on February 25, Richmont released its first resource estimate for the new “C” zone at the Island Gold Mine and it came in at 1.5 million tonnes grading 10.73 g/t Au for 508,000 ounces…the C zone is subvertical at depths of between 450 metres and 1,000 metres and appears to be an extension of the areas currently being mined…the resource has been drilled on an approximate 50-metre-by-50-metre pattern, with 55 drill hole intercepts…importantly, the average true width of this zone at depth is estimated at 4.5 metres, compared with an average of 2.7 metres above the 400-metre level (current mining operations)…in addition, preliminary metallurgical testing on representative samples has shown high recovery rates (over 96%)…Richmont will be investing $35 million in the Island Gold deep project this year which will include approximately 40,000 metres of drilling…after soaring from around $4 in early 2011 to an all-time high just above $13 a share later in 2011, Richmont has corrected a whopping 80% and is currently trading considerably below book value at $2.30 with just 40 million shares outstanding…if the risk-reward ratio wasn’t very attractive at $13 per share, it certainly is now around $2.30…yesterday, RIC hit a new 4.5-year low of $2.26 and closed down 8 cents at $2.29 (the slide in the Gold Index the last few days brought about a 19% drop in the share price)…as always, perform your own due diligence…we’ll have more on Richmont next week…below is a 5-year weekly chart from John…

Zenyatta Ventures (ZEN, TSX-V) Chart Update

Zenyatta Ventures (ZEN, TSX-V) climbed 18 cents on total volume (all exchanges) of nearly 2 million shares yesterday as it announced it has intersected the widest zone of graphite mineralization (47 metres to 410 metres) to date at its Albany Project in northeastern Ontario…results from this first hole are expected within the next two to three weeks…ZEN has pulled back slightly in early trading today, down 9 cents to $1.90…below is an updated chart from John…support is at $1.75…RSI(14) needs to break out above the down trendline in this 6-month daily chart before ZEN can regain serious momentum…

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