Gold is firmer this morning after a weaker-than-expected U.S. jobs report Friday…as of 6:00 am Pacific, the yellow metal is up $16 an ounce at $1,647…Silver has gained 27 cents to $31.98…Copper is flat at $3.79…Crude Oil is down $1.61 a barrel to $101.70 while the U.S. Dollar Index is up slightly at 79.95….
This is an abbreviated edition of Morning Musings due to the Easter long weekend…regular postings resume tomorrow…
Gold imports into India tumbled more than 55% in March, thanks to a nation-wide jeweler’s strike to protest a tax on non-branded ornaments…the strike continues….the president of the Bombay Bullion Association noted that the country imported just 15 to 20 tonnes of Gold in March compared to the 45 to 55 tonnes that is usually imported on a monthly basis…he added that the high price of the precious metal also deterred fresh purchases in the first quarter…An upcoming Hindu festival, Akshaya Tritiya, held on April 24, may be the catalyst that brings the jeweler’s strike in India to an end and moves Gold prices higher in April…
Historically, March is the weakest month of the year for Gold prices as shown in the chart below…
Gold stocks have been beaten down dramatically since the end of February to the point of ridiculous extremes – in fact, they are very close to being at their most oversold levels relative to the broad stock market since the lows of the 2008 panic…this is a time to be going against the crowd, not with the crowd…
Big Week For Data Out of China
Inflation in China rebounded slightly in March…the benchmark consumer price index increased 3.6% cent last month from a year earlier, mostly as a result of higher food and energy prices, according to government figures released this morning…the inflation number is the first in a flurry of data releases set for this week that analysts and investors hope will provide a clearer picture of what is happening in the world’s second-largest economy…Beijing on Friday will unveil China’s first-quarter gross domestic product figure, which is expected to show that annualized growth slowed from 8.9% in the fourth quarter of 2011 to about 8.4%…some analysts are growing increasingly bullish on China’s growth outlook for this year, so a “hard landing” in China just doesn’t seem to be in the cards…
Today’s Markets
Stock index futures in New York are pointing to a weak opening on Wall Street this morning…the Venture Exchange closed Friday at 1481, a drop of 85 points for the week or 5.4%…John will have an updated CDNX chart tomorrow…it may not seem so right now, but we believe this will be a stellar year for the Venture which means this pullback is full of opportunities…we’ll share some of those tomorrow…
The strike in India is over
Comment by Steve — April 9, 2012 @ 7:22 am
http://online.wsj.com/article/SB10001424052702303302504577327283295554276.html
Comment by Steve — April 9, 2012 @ 7:23 am
GBB is sliding…. my sixth sense, it will go to 12 cents today…. someone just wants to keep the same price at 14 cents by buying 1,000 shares to stop the slide. This is not going to work as it will go further down today! Check it out…
Comment by Theodore — April 9, 2012 @ 8:52 am
Strike over in India but there isn’t a demand for Gold. Did the inverse H&S fail? Looks more and more like the bull market is over – regardless, as far as stocks are concerned it makes no difference if gold reaches new highs; the juniors in the past few years have gone the otherway! 🙂
Comment by Andrew — April 9, 2012 @ 10:25 am
The sentiment is plain awful, never seen this since 2008. Good sign we are approaching bottom
Comment by Steve — April 9, 2012 @ 11:14 am
Steve – the O/S conditions in the juniors are indicative of another 2008. On the TSX I looked at BRD today and it looks as if it will touch its 2008 low – the 5yr monthly chart sums it up – 3 yr downtrend/channel as gold prices have been going higher!
Comment by Andrew — April 9, 2012 @ 11:26 am
That is really sick with gold over 1600 and silver over 30
Fundamentals has been thrown out the window
Looks like everybody is fleeing the sector
Comment by Steve — April 9, 2012 @ 11:37 am
what happened to the CDNX? where is support,etc? feels really bad for sure out there…
Comment by STEVEN — April 9, 2012 @ 11:51 am
Cashy and cautious for the time being. We have another 2 months of hell then things will improve. I would expect QE3 to come in Aug/Sept, but that’s after a brutal correction. Perhaps we retest 1300 on the CDNX. We’re almost there, so it’ll get worse before it gets better.
Goldman Sach has put a target of 1250 on the S&P500, so expect more downside in all equities especially the CDNX. The worst is yet to come and Andrew is right that even though gold rally’s in fearful times that doesn’t mean small cap equities will follow in fact it does the opposite.
Time to put the ear muffs on and go into hibernation for 2-3 months. Wake up and we should see some all time lows and then we can get greedy when everyone is fearful.
Forget BMR’s technical analysis. You’ll know when we have bounced – it will be when the CDNX starts to outperform the TSX and Dow. Right now its underperforming all indicies so we’re still in a downtrend.
Comment by Andrew M — April 9, 2012 @ 11:51 am
first support – 1440 then 1400
Comment by dave — April 9, 2012 @ 7:21 pm