BullMarketRun   BullMarketRun.com

A Daily, Vibrant Voice Focused on Speculative Opportunities,
Commodities, and Economic & Political Trends Impacting
The Resource Sector & Equity Markets
 

"Market-Trouncing Returns Through Unbeatable
Technical & Fundamental Analysis of Niche Sectors"

May 6, 2014

BMR Morning Market Musings…

Gold has traded between $1,304 and $1,315 so far today…as of 8:35 am Pacific, bullion is down $2 an ounce at $1,310…Silver is up 3 cents at $19.61…Copper is flat at $3.06…Crude Oil is 81 cents higher at $100.29 while the beleaguered U.S. Dollar Index has plunged more than one-third of a point to 79.12…as we have repeatedly stated for months, the Dollar Index is in trouble (critical support at 79 may not hold) and that has to be considered bullish for Gold

Gold’s safe-haven appeal is evident with a ramping up of the tense situation in Ukraine…thirty pro-Russia insurgents and four government troops have been killed in Ukraine during operations to expunge anti-government forces around a key eastern city, Ukraine’s interior minister reported today…

Gold needs fresh longs and can’t rely on short-covering to sustain higher prices according to UBS…any short-covering rally in Gold would have “limited longevity”, UBS contends…gross speculative shorts on Comex stood at 8.5 million ounces as of April 29, the cutoff date for the latest weekly report from the Commodity Futures Trading Commission…this means enough potential for “nervous shorts” to fuel a “decent” initial rally, according to UBS…still, the level is down from 13.5 million ounces at the end of last year, which led to a sharp short-covering rally in February, UBS stated…

One of the most accurate Gold forecasters over the years has been Martin Murenbeeld, Dundee Capital Markets’ chief economist…he outlined three possible scenarios for an average 2014 bullion price as one of the keynote speakers at the European Gold Forum in Zurich – Worst Case ($1,182),  Median ($1,307) and Best Case ($1,409), and came up with a weighted average price of $1,311…that makes him considerably more bullish than Goldman Sachs and some others…

Gold Recovered From 1857 Shipwreck

Close to 1,000 ounces of Gold, worth about $1.3 million dollars, has been recovered from an 1857 shipwreck off the coast of South Carolina…Odyssey Marine Exploration, Inc. (OMEX, NASDAQ), seen as a  pioneer in deep-ocean exploration, recovered the Gold recently during its first two-hour exploration dive of the SS Central America shipwreck site, the company announced yesterday…the Gold recovered included five Gold ingots and two $20 Double Eagle coins; one of the coins was minted in 1857 in San Francisco and the other coin was minted in 1850 in Philadelphia…

OECD Lowers Global Growth Outlook

The Organization for Economic Cooperation and Development (OECD) warned today that the global economy will grow by less than expected this year after it lowered its forecasts for the U.S. and China…the OECD now predicts the global economy will grow by 3.4% this year, down from its forecast of 3.6% growth last November…the OECD cut China’s growth forecast this year to 7.4% from 8.2% in November…meanwhile, the is forecast to grow 2.6% this year against last November’s 2.9% estimate…meanwhile, the OECD has urged the European Central Bank to cut interest rates, even as it said it expects the recovery in the euro zone to accelerate this year…

Today’s Equity Markets

Asia

Asian stocks were mixed overnight in holiday-thinned trade with markets in South Korea, Hong Kong and Japan shut…China’s Shanghai Composite added 1 point to close at 2028…

Europe

European shares closed modestly lower today on mixed earnings results…retail sales in the 18 countries that share the euro rose in March for the third straight month, a sign that consumer spending is set to aid the currency area’s modest economic recovery…also released Tuesday, business surveys indicated the euro zone’s economy grew at the fastest pace for almost three years in April, but manufacturers and service providers continued to cut their prices…the surveys also showed that growth became more balanced, with Spain and Ireland expanding most rapidly, and activity also picking up in Germany and Italy…

North America

The Dow is off 78 points as of 8:35 am Pacific…the TSX is down 61 points while the Venture is unchanged at 1010…Doubleview Capital Corp. (DBV, TSX-V) hit a new all-time high of 40 cents this morning as speculation heats up regarding the company’s recently completed first round of 2014 drilling at the Hat Property…on trend and just 1,000 m away from DBV’s discovery holes HAT-08 and HAT-11 is Ashburton Ventures Inc. (ABR, TSX-V) which is now active on the ground in the Sheslay Valley…ABR is unchanged at 6 cents as of 8:35 am Pacific after a 33% jump yesterday…meanwhile, Garibaldi Resources Corp. (GGI, TSX-V) is showing signs of potentially breaking out as it’s up 2 cents at 22 cents through the first two hours of trading…Prosper Gold Corp. (PGX, TSX-V), unchanged at 54 cents, is gearing up for the start of drilling at the Star Project…we’ll have more on that tomorrow…on the other side of the country, Gold Bullion Development Corp. (GBB, TSX-V) released encouraging preliminary feasibility study numbers this morning for a “rolling” production start at the Granada Gold Property in northwest Quebec with a 7-month payback period for the $6.7 million estimated to commence the rolling start…share structure, however, continues to be an obstacle in terms of GBB gaining serious traction in the market – plenty of “loose” stock from cheap financings still needs to be cleaned up…

TSX Updated Chart

The TSX is trading near the top of an impressive upsloping channel that has been in place since the beginning of last summer…strong support is at 14200, in between the rising 50 and 100-day moving averages (SMA’s) and at the lower end of the upsloping channel…

TSX14

BMO Junior Gold Index ETF Chart

Below is an interesting chart that provides additional evidence that the trend in the Gold stock sector has indeed reversed…the BMO Junior Gold Index ETF has gone through a 1-year bottoming pattern which could very well be an inverted H&S with the right shoulder still in development…the CMF indicator shows a reversal from sell pressure, dominant throughout most of 2013, to buy pressure with increasing accumulation…note how the 200-day SMA (MA-40 on this weekly chart) flattened out at the beginning of this year, after a long decline, and is now rising gently…

This ETF has been designed to replicate, to the extent possible, the performance of the Dow Jones North America Select Junior Gold Index…

ZJG3

Below are the top holdings in the Junior Gold Index…as always, perform your own due diligence…

ZJG1

Rackla Metals Inc. (RAK, TSX-V)

We’ve mentioned this one before and it’s worth having on your radar screen – Simon Ridgway’s Rackla Metals (RAK, TSX-V)…RAK has seen an uptick in volume over the past couple of months (9 months of selling pressure dried up by mid-March) while trading essentially between 3 and 4 cents…Ridgway, like many others, appears to have lost interest in the Yukon, so it wouldn’t surprise us if he were to put a new project (in a different jurisdiction) into Rackla…the company will need to raise more money but has no debt…bottom-fishing opportunity at current levels…RAK closed at 4 cents yesterday…

RAK4

Hidden Gem?  Mistango River Resources Inc. (MIS, CNSX)

The CNSX is drawing more interest these days, and one company that caught our attention yesterday is Mistango River Resources (MIS, CNSX) which had the good fortune of acquiring some strategic claims in Quebec thanks to a staking mess that ensued after one company apparently forgot to renew its claims…this was an interesting situation, and the Quebec Ministry of Natural Resources decided to award the claims to two companies (one of them being Mistango) with existing land packages and a long history in the area…this company has a strong working capital position and a lot going on, and keep in mind that the “new” Osisko will hold about 30% of Mistango which has only 38 million shares outstanding and no warrants…we like this company’s prospects and we’ll keeping a close eye on MIS in the weeks and months ahead…MIS is up 4 cents at 14 cents as of 8:30 am Pacific

Note:  John and Jon both hold share positions in GGI, DBV and ABR.  Jon also holds a share position in PGX.

 

 

9 Comments

  1. FYI the search on your site isn’t working for recent articles.

    Comment by M. — May 6, 2014 @ 7:53 am

  2. It’s working fine on our end, perhaps you can be more specific…

    Comment by Jon - BMR — May 6, 2014 @ 7:57 am

  3. GBB… totally no support… beware guys!

    Comment by Theodore — May 6, 2014 @ 8:14 am

  4. As an example, a search for “GBB” doesn’t return any articles from 2014. The first result that is returned is from December 18, 2010. I know there is at least 1 or 2 articles on GBB in 2014 before today’s.

    thanks! 🙂

    Comment by M. — May 6, 2014 @ 8:19 am

  5. M., we’ve only made 1 or possibly 2 very brief mentions of GBB in Morning Musings this year, prior to today, no “articles”.

    Comment by Jon - BMR — May 6, 2014 @ 8:29 am

  6. same for “Doubleview”, it doesn’t find the May 5th musing. 😉

    Comment by M. — May 6, 2014 @ 8:44 am

  7. Theodore …. most on the cdnx have no emotional followers…. lots of fear as well as noone is willing to extend their buys with May in full swing..
    GBB is just one of many… but with the goods in the ground AND PEA’s etc, once the movement starts, it will do fine… might lag due to the paper… but will grow… how big??
    who knows…
    your beware comment could be spread to most of the venture stocks yes?? 🙂
    keep up the good work mate….

    Comment by Jeremy — May 6, 2014 @ 8:53 am

  8. Jeremy, in the past… yes, there are followers but now, GBB is finished… unless someone is taking the chance to buy a huge lot. Currently, it is 3 cents… all gains this morning were gone and same day trading guys have left the show. This kind of turnover is the day trade result. I will post the comments for TH … R … NAR… GBB is perfect for this!

    Comment by Theodore — May 6, 2014 @ 11:17 am

  9. GBB will have followers again once it starts moving…. once it starts…. which it will… human nature is predictable!

    Comment by Jeremy — May 6, 2014 @ 3:13 pm

Sorry, the comment form is closed at this time.

  • All Posts: