Gold has traded between $1,301 and $1,310 so far today…as of 8:30 am Pacific, bullion is down $4 an ounce at $1,304 after Friday’s $14 rally…Silver is off 17 cents at $20.57 (see updated Silver charts at bottom of today’s Morning Musings)…Copper is up a penny at $3.25…Crude Oil is down 67 cents at $101.42 while the U.S. Dollar Index is off slightly at 80.99…
As John’s updated 6-month daily chart showed Saturday, Gold has strong near-term support in the $1,280’s, and two resistance bands to work through just above current prices – $1,306 to $1,310, and $1,320 and $1,330…a sustained move above $1,330 would put the bears on the defensive…a busy economic calendar in the U.S., including a Fed meeting tomorrow and Wednesday, and geopolitical developments could both impact Gold positively or negatively this week…
Gold finished June at $1,327 and is headed for a possible July decline after rallying 10% in the first half of the year, a gain that outpaced broad measures of commodities, equities and treasuries…
Sales of Gold coins at the U.S. Mint are heading for the worst month since March, Bloomberg reported this morning…holdings in ETF’s backed by the metal fell by 2.3 tons last week, or 0.1%, the first drop in five weeks…
Hot spots around the world aren’t likely to cool off anytime soon, and at the very least that should put a floor of strong support underneath Gold prices…
Hamas is attempting to negotiate a new arms deal with North Korea for missiles and communications commitment that will allow it to maintain its offensive against Israel, according to Western security sources as reported by The Sunday Telegraph…security officials say the deal between Hamas and North Korea is being handled by a Lebanese-based trading company with ties to the Palestinian terrorist organization…Hamas officials are believed to have already made an initial cash down payment to secure the deal and are hoping that North Korea will soon begin shipping extra supplies of weapons to Gaza…
Stepping up pressure on Moscow, the U.S. yesterday released satellite images it says show that rockets have been fired from Russia into neighboring eastern Ukraine and that heavy artillery for separatists has crossed the border…the images, which came from the U.S. Director of National Intelligence, show blast marks where rockets were launched and craters where they landed…officials said the images show heavy weapons fired between July 21 and July 26 – after the July 17 downing of Malaysia Airlines Flight 17….
Excellent op-ed piece (“Our Duty is to Stand Firm in the Face of Russian Aggression”) from Canadian Prime Minister Stephen Harper in Saturday’s Globe and Mail regarding Russia – more than any other western leader, Harper understands the “big picture” threat to world peace and security posed by the Putin regime…below is an except from his comments…
“The pro-Russian separatists “derive their material, political and logistical support from the Putin regime, and their criminal aggression and recklessness reflect the values of their Russian benefactors…Russia’s aggressive militarism and expansionism are a threat to more than just Ukraine; they are a threat to Europe, to the rule of law and to the values that bind Western nations. Canada will not stand idly by in the face of this threat…with Mr. Putin’s Russia increasingly autocratic at home and dangerously aggressive aborad, now is not the time to ease the diplomatic and economic pressure on the regime…sustained, strong and co-ordinated action among like-minded countries is the best way to ensure that our actions have the maximum impact on the Putin regime…it is difficult to foresee any circumstance under which Mr. Putin’s Russia could be readmitted to the family of G7 nations.”
Today’s Equity Markets
Asia
Asian markets shrugged off Wall Street’s jitters Friday with a strong start to the week…China’s Shanghai Composite led the way, rocketing 51 points higher overnight to close up for the seventh straight session at a 7-month high of 2178…the mini-stimulus that was delivered in April and May seems to be having an effect…profits at industrial companies in China increased 17.9% in June from a year earlier, after gaining 8.9% in May, data from China’s statistics bureau showed yesterday…that was the biggest advance since an 18.4% jump in September and came after a private gauge of Chinese manufacturing last week rose to an 18-month high…China has cut reserve requirements for some banks, accelerated infrastructure spending and loosened property curbs as Premier Li Keqiang seeks to keep growth from falling below his 7.5% target…
Japan’s Nikkei gained 72 points to close at 15529, a new 6-month peak…
Europe
European markets were mixed today…the European Union has agreed to impose economic sanctions against Russia for its role in the Ukraine crisis. The outline agreement was reached on Friday but didn’t include any penalties on the energy sector…Moscow reacted to the sanctions by warning that they would hamper cooperation on global security issues…
North America
The Dow is off another 22 points as of 8:30 am Pacific after Friday’s 123-point decline…it’s an important week for earnings and economic data including a jobs report, a preview of second quarter GDP, and ISM manufacturing data…in addition, the Federal Reserve meets tomorrow and Wednesday to review monetary policy before monthly U.S. payrolls data is released Friday…according to economists’ estimates compiled by Bloomberg, employers probably added 231,000 workers to non-farm payrolls in July, after a 288,000 increase in June…the unemployment rate is expected to hold steady at 6.1%, its lowest level in nearly six years…
The TSX is down 17 points while the Venture has shed 3 points to 1014 as of 8:30 am Pacific…
Contact Exploration Inc. (CEX, TSX-V) Update
Contact Exploration (CEX, TSX-V) released updated financials this morning…the company experienced significant growth during the 2014 fiscal year ending March 31…petroleum and natural gas revenues more than doubled from fiscal 2013 while total assets increased by more than 50%…net income for fiscal 2014 was $2.8 million compared to $2.1 million for 2013…CEX is unchanged at 44 cents as of 8:30 am Pacific…
Constantine Metal Resources Ltd. (CEM, TSX-V) Update
Constantine Metal Resources (CEM, TSX-V), which we mentioned last week when it was still trading under 20 cents, is worthy of our readers’ close attention as the summer progresses…last Wednesday, the company released results from the first two holes of a 10,000-metre drill program at the Palmer VMS Project in Alaska…initial drilling has intersected a thick lens of massive sulphides 150 metres down dip of the lower edge of the South Wall zone, a major expansion of the zone to depth…hole CMR14-54 returned 22.1 m grading 2.48% Cu, 4% Zn, 24 g/t Ag and 0.39 g/t Au…if additional holes can return even better grades, then CEM could gain a lot more attention…
The current drilling is part of a $6.2-million (U.S.) budget for 2014 financed by partner Dowa Metals & Mining Co. Ltd. of Japan…Dowa is in the second year of an option agreement in which it can earn 49% in the Palmer project by making aggregate expenditures of $22-million (U.S.) over four years…at this early stage, Palmer hosts a 4.75-million-tonne inferred resource grading 1.84% Cu, 4.6% Zn, 0.28 g/t Au and 29 g/t Ag…
Below is an updated 2.5-year weekly chart from John…CEM is trading at levels not since seen 2011, a very bullish sign…note that there is measured Fib. resistance at 21 cents, followed by 31 cents (not shown on this chart), so a brief near-term consolidation is certainly possible with the rising 20-day SMA likely to provide very strong support on any pullback…CEM is off half a penny at 21 cents as of 8:30 am Pacific…
NioGold Mining Corp. (NOX, TSX-V) Update
NioGold Mining (NOX, TSX-V) has been looking attractive ever since it broke above a long-term downtrend line in the low teens in early December…
NOX surged as high as 35 cents intra-day Friday after it was announced that Osisko Gold Royalties Ltd. (OR, TSX) has signed an LOI with NioGold, pursuant to which Osisko will acquire 14 million flow-through common shares of NOX at 35 cents per share through a private placement…in addition, Osisko will purchase from NioGold (for $150,000) the right to repurchase certain royalties on its claims…
As we pointed out in late May, NioGold commenced a 1,400-metre drill program on its recently acquired H zone, now consolidated as part of the company’s Malartic Block Property along the Cadillac Trend…drill results are pending…the Marban Block already has three deposits (Marban, Kierens and Norlartic) which collectively host estimated measured and indicated resources of 1.5 million ounces of Gold (32,127,000 tonnes grading 1.48 g/t Au) plus inferred resources of 600,000 ounces (16,478,000 tonnes grading 1.13 g/t Au)…
Below is an updated 2+ year NOX chart from John…an important confirmed breakout has occurred here above 22.5 cents…the stock is unchanged at 28 cents through the first two hours of trading…
Prosper Gold Corp. (PGX, TSX-V) Update
Quite simply, the geology is too prospective and the team on the ground, led by the highly respected Dirk Tempelman-Kluit, is too talented for Prosper Gold (PGX, TSX-V) not to hit BIG at the Star Project in the Sheslay district this summer…at this point, it’s just a matter of remaining patient for the first results to come in before the PGX train starts to pick up speed…
Technically, PGX has superb support in the mid-30’s and resistance currently at 40 cents as you can see in the 2.5-year weekly chart below…a declining 50-day SMA has been pressuring and restraining PGX in recent weeks, coupled we suspect with some selling of flow-through shares purchased at 40 cents in last summer’s financing…the dynamics with PGX could really change dramatically once the flow of results from the Star Project begins…
PGX is up 4.5 cents at 41.5 cents as of 8:30 am Pacific…
Great Prairie Energy Services Inc. (GPE, TSX-V) Update
Great Prairie (GPE, TSX-V) is another energy play we’ve been tracking closely, and the current technical set-up suggests there’s a strong possibility of a breakout in the near future above a narrow horizontal channel that has formed this month between 50 and 55 cents…directly beneath this channel, providing excellent support, is the rising 50-day SMA at 46.5 cents (not shown on the 6-month chart below)…
GPE, unchanged at 54 cents as of 8:30 am Pacific, reported net income of $1.4 million on total revenue of $5.3 million for its first quarter ended March 31…
Silver Short-Term Chart
This 6-month daily chart shows how extreme RSI(2) conditions in Silver persisted over nearly two weeks in June…since then, RSI(2) has been gradually unwinding and is currently at 57%…Fib. support levels in this market at the moment are key in our view…John has highlighted several Fib. retracement areas – $20.33 (touched last week), $20.08, $19.82 and $19.50…
Silver Long-Term Chart
Silver has broken out above one important downtrend line but has been trading in rather choppy fashion recently…RSI(2) closed last week at 69% – could unwind a little more – with the metal still marginally below strong resistance around $22…
Note how the SS is moving up from a low bullish “W” while the ADX indicator shows the growing potential for a bullish +DI/-DI crossover this quarter…bottom line – Silver looks highly attractive around the $20 level…
Note: John and Jon both hold share positions in PGX.
I suspect Mineralisation found at deapth in S027 will help them to figure out better how those zone would connect near surface.
Comment by Martin — July 28, 2014 @ 7:57 am
What’s news about DBV ????
Comment by Guy Delisle — July 28, 2014 @ 8:22 am
This is how World Wars get started. If these numbnuts think economic sanctions is going to bring world peace, they are sorely mistaken. The world is shifting to the east. Russia has more allies than our politicians want to admit. France, Germany, Luxembourg, Austria, Bulgaria, Greece, Cyprus, Slovenia have all said publicly that they are not going to support economic sanctions against Russia. 2) There is no evidence that the separatist shot down the plane. None whatsoever at this moment. What has been confirmed is that Ukranian fighter jets were seen flying alongside the plane. This was confirmed by Russia which provided radar evidence and was confirmed by several eyewitnesses during a BBC interview, which, I must add, has strangely disappeared from their site. 3)None of this would have happened if Nuland and her cronies hadn’t destabilized the country earlier in the year, which allowed them to install a puppet regime, which has backfired since Yatsenyuk resigned last week. They should have allowed the people to decided which side they wanted to join. That is what Putin did, but our leaders are not happy with the results. Enough ranting for today.
Comment by Chris — July 28, 2014 @ 8:40 am
Garibaldi is going to hold an online presentation, doesn’t say what date and time yet, hopefully we will hear something good!!??
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Comment by Greg — July 28, 2014 @ 7:59 pm
Guess news is around the corner!!!!!
Comment by Tran — July 28, 2014 @ 10:51 pm
your team is the best I follow again I bring to your attention toe(ven) triorigin this co. has good management good property(in Canada) no money regards walter
Comment by walter emond — July 29, 2014 @ 12:49 am
Some analysts predicting Gold to start moving after this week’s Fed meeting?? Jon: is the Shanghai market starting to move up again? Thanks….
Comment by STEVEN1 — July 29, 2014 @ 5:21 am
BNN said China is in a Bull market now! doesnt the venture follow that market somewhat?
Comment by STEVEN1 — July 29, 2014 @ 5:23 am
Hi Steven, we’ve shown some interesting chart similarities between the Venture and the Shanghai over the last 7 years or so, so the fact that China is picking up steam has to be considered another favorable signal for the Venture…
Comment by Jon - BMR — July 29, 2014 @ 10:47 pm