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October 23, 2014

BMR Morning Market Musings…

Gold has traded between a high of $1,246 and and low of $1,225 so far today…as of 8:30 am Pacific, bullion is down $13 an ounce at $1,228…we’ll see if it can hold support at $1,229 on a closing basis…Silver is up 4 pennies at $17.22…Copper has added 4 cents to $3.06 on some encouraging economic data…Crude Oil is $1.27 higher at $81.79…the government’s inventory report showed Crude inventories rose 7.1 million barrels in the last week, well above the expected 2.8 million barrels….the U.S. Dollar Index is up nearly one-tenth of a point to 85.85

Investors may increase their net Silver purchases by as much as 1 billion additional ounces in various investment instruments over the next decade, according to a report issued by The Silver Institute…this would be on top of more than 860 million purchased as an investment since 2006, the report says…the report was produced by the consultancy CPM Group…the dollar value of the Silver market, which includes trading volumes on the major futures and options exchanges and clearing volumes of the London over-the-counter market, combined with newly refined Silver supply, stood at $5.1 billion in 2013, the report says…

At the close of 2013, at least 2.3 billion ounces of Silver were held in bars and coins around the world, according to CPM Group.  “Even in these days of precious metal price volatility, we are seeing areas of growth within the Silver investment arena,” says Michael DiRienzo, executive director of The Silver Institute. “This year’s progression in Silver exchange-traded funds, for example, suggests that investors are very keen to acquire and hold the white metal.”

A slim majority of Swiss citizens said they would vote yes to force the Swiss National Bank to increase and hold on to their Gold reserves, according to the country’s first opinion poll…earlier this week, 20 Minuten, Switzerland’s largest daily newspaper, released the results of its online survey…according to the poll, which was conducted on October 15 and had more than 13,000 respondents, 45% to 39% said they would support the “Save Our Gold” initiative…however, the survey also apparently showed a high number of undecided voters…

Central Bank Gold Reserves

As Frank Holmes pointed out recently at www.usfunds.com, since 1993, the Swiss central bank has reduced its Gold holdings by a whopping 1,550 tonnes, the largest liquidation by any central bank as you can see in the chart below (China last reported its holdings in 2009 but is now believed to hold a much higher amount)…

Central Bank Gold Reserves

Today’s Equity Markets

Asia

Asian markets were down modestly overnight…China’s Shanghai Composite slipped 23 points to 2302, hitting a new 1-month low…China’s HSBC flash manufacturing PMI rose to a 3-month high of 50.4 in October, above the bank’s final reading of 50.2 last month…however, the report highlighted issues in Beijing’s economy with factory output falling to a 5-month low…the data comes amid speculation of additional stimulus measures to boost growth after Q3 GDP fell to a 5-year low…Hongbin Qu, China chief economist, and co-head of Asian economic research at HSBC, stated to CNBC:  “While the manufacturing sector likely stabilized in October, the economy continues to show signs of insufficient effective demand. This warrants further policy easing and we expect more easing measures on both the monetary as well as fiscal fronts in the months ahead.”

Japan’s Nikkei average took a breather after yesterday’s strong advance and eased 57 points to 15139…the Nikkei has been extremely volatile this week with a 4% gain on Monday, a 2% decline Tuesday and yesterday’s 2.6% recovery…

Europe

European markets were up significantly today…euro zone PMI data was stronger than expected with composite PMI coming in at 52.2 in October, up from 52.0 in September…

North America

The Dow is up 244 points as of 8:30 am Pacific with sentiment bullish after heavy-equipment maker Caterpillar Inc. (CAT, NYSE) boosted its full-year profit outlook…the S&P 500 has climbed 27 points to 1955

The TSX is up 160 points following yesterday’s sell-off that was triggered by the brazen terrorist attack at Parliament Hill and the National War Memorial that claimed the life of a Canadian soldier…by the grace of God, there wasn’t a massacre and the hero of the day was Sergeant-at-Arms Kevin Vickers who was able to kill the gunman, a Canadian turned Muslim extremist (police are still searching for other individuals potentially involved)…

The Venture is up 2 points at 810 through the first 2 hours of trading…

U.S. Dollar Index Updated Chart

Stubbornly, the U.S. Dollar Index continues to remain in overbought territory…this condition could persist for a while yet, we’ll have to wait and see…RSI(14) has dropped from nearly 90% on this 2.5-year weekly chart but appears to have stabilized above 70%…measured Fib. resistance is 88, a level we may yet see before a sustained correction sets in…the rapidly rising 50-day moving average (SMA) is providing support just beneath 85

USD147

Graphene 3D Lab Inc. (GGG, TSX-V) Updated Chart

As John’s chart showed Tuesday, Graphene 3D Lab (GGG, TSX-V) has been gaining technical momentum recently…yesterday, it climbed 11 cents to close at $2.09…it opened higher this morning ($2.26), quickly surged to $2.39, retraced to $2.15 and is now up 20 cents at $2.29 as of 8:30 am Pacific

We first mentioned this interesting but volatile play in mid-August, shortly after it made its debut on the Venture and climbed from a low of 40 cents to more than $1 in the first two trading sessions…

Below is another updated chart to help readers with their own due diligence – as always, we encourage investors to contact management and perform their own DD on any company they might be interested in…

After climbing as high as $2.56 in early September, GGG quickly retraced to the Fib. 38.2% level around $1.22 where the rising 50-day SMA currently sits…since then, GGG has been gradually climbing again before really kicking into gear late yesterday after pushing back above the $2 level…

RSI(14) unwound from extreme overbought conditions from mid-September to mid-October, finding support at the 50% level, and is now on the upswing again…

 GGG3

Calibre Mining Corp. (CXB, TSX-V) Update

Calibre Mining (CXB, TSX-V) has been one of the top-performing exploration plays over the last several months, attracting a major new investor (Peter Lassonde) and reporting success at its projects in Nicaragua – some of which are promising JV’s with partners B2Gold Corp. (BTO, TSX) and Iamgold Corp. (IMG, TSX)…

The recent pullback in CXB is not totally surprising given the very overbought RSI(14) conditions that emerged in September…the stock hit a nearly 2-year high of 20 cents last week and has now retreated to an area of significant Fib. and chart support that includes the rising 100-day SMA at 13 cents…CXB is unchanged at 13.5 cents as of 8:30 am Pacific

CXB18

Newstrike Capital Inc. (NES, TSX-V) Update

We continue to keep a close eye on Newstrike Capital (NES, TSX-V) which has really outperformed the sector over the last couple of months, and can certainly be considered a potential takeover candidate…

On September 15, Newstrike released a very robust Preliminary Economic Assessment for its Ana Paula Project in Mexico’s prolific Guerrero Gold belt…we urge our readers to check that out as the projected capital costs are relatively low and the IRR is 47.5% with a 2-year payback…the deposit at Ana Paula can be described as having a high-grade core, surrounding by a lower grade envelope of Gold and Silver mineralization…the high-grade nature of this Gold mineralization starts just below surface and extends to approximately 700 m deep…

(It’s worth noting that the geologist who has played a key role at Ana Paula, the highly respected Dr. Craig Gibson, is also busy overseeing Garibaldi Resources Corp.’s (GGI, TSX-V) Rodadero and La Patilla projects in Mexico…with Gibson’s proven insight and ability to identify a discovery and put a resource together, we see very positive developments in the works at both Rodadero and La Patilla).

Getting back to Newstrike, it appears to have formed a head-and-shoulders reversal pattern but critical resistance, which it has not been able to overcome yet, is around the $1.20 level…as of 8:30 am Pacific, NES is resting at its 50-day rising SMA, off 3 pennies at $1.01

NES4

 Note:  John and Jon both hold share positions in GGI.

14 Comments

  1. can you confirm cup with handle pattern on GBB or is it head and shoulders?

    Comment by marc — October 23, 2014 @ 10:00 am

  2. All my picks moving today including my new one microcoal – here they are buy them and prosper Sev – Dvg – Enp – Mti

    Comment by berrypolin — October 23, 2014 @ 10:10 am

  3. I know I’ve been going on about Fancamp (fnc.v) for a while now but, and if you’re willing to take a gamble, you should take a long hard look at it. AGM is Oct.30 and they are awaiting news from Chinese scientists regarding their advanced metallurgical work on their crown jewel the Magpie Deposit. My guess is they will announce results after all directors are voted in. They just put out a couple good NR regarding their other properties;

    Fancamp assays 24.7 m of 16.9 g/t Ag, 2.78% Cu at Namex
    Read more at Stockwatch website

    Fancamp channel samples 1.7 m of 91.8 ppm Au in Quebec
    Read more at Stockwatch website

    From a technical perspective and although the volume is low, it looks like the stock is about to break out. RSI, MAC D and Parabolic SAR are all pointing bullish (and if you look at 3 year weekly chart, you will notice that every time the Parabolic SAR is supporting the candle, the s/p increases). I am keeping this as a long term play, but I think you could flip this in the next couple of weeks if you get in now. Currently trading near historic low @ 5 cents.

    GLTA

    Comment by Tony T — October 23, 2014 @ 10:14 am

  4. Garibaldi Resources Corp GGI:TSXV – News Alert

    Garibaldi makes new surface discovery north of Silver Eagle

    Comment by Bert — October 23, 2014 @ 2:38 pm

  5. GGI NEWS on Stockwatch

    Comment by John BMR — October 23, 2014 @ 2:45 pm

  6. News ggi, no results but very encouraging.

    Comment by Tombc — October 23, 2014 @ 2:46 pm

  7. Sounds like interest from other party’s . Could we have some heavy hitters stepping Jon?

    Comment by Tombc — October 23, 2014 @ 2:51 pm

  8. This is big, Tom…a “leading international silver and gold producer” (any guesses?) wouldn’t make a SECOND visit to Rodadero unless they liked what they saw the first time around…they aren’t roasting marshmallows there…plus the Chinese on top of that…unsolicited approaches…the geology is very encouraging here, looks like continuity of near-surface mineralization, semi-massive sulphides, more high-grade, expansion of the zone, and what I’m really intrigued about is the surface discovery 150 m north of SE-14-01——importantly, it’s at a lower elevation, suggesting indeed that they’re on the trail of a feeder zone(s)…sometimes these zones can prove to be very rich…this is shaping up to be a really, really interesting wide-scale discovery that could include all sorts of possibilities…in one word – exciting…that’s why they’ve attracted this outside interest…

    Comment by Jon - BMR — October 23, 2014 @ 3:23 pm

  9. Isn”t Goldcorp close by? in Mexico?

    Comment by Greg — October 23, 2014 @ 3:27 pm

  10. Jon

    No doubt, i enjoy your positive reaction, but we have to take one
    step at a time. Companies being inquisitive, don’t necessarily mean
    they will make a move, after all, this play is in it’s infancy &
    we must allow it to mature, but it’s one, that i feel comfortable
    with. We the undersigned, realize you, like us, are yearning for a
    winner & may this be it.

    Me, myself & I

    Comment by Bert — October 23, 2014 @ 4:04 pm

  11. Yes I agree, it sure looks like we’re heading in the right direction,yes one step at a time, should grap some attention in the comming weeks and months,all in all encourageing.

    Comment by Tombc — October 23, 2014 @ 4:27 pm

  12. You’re right, Bert, everything goes in steps…we’ll learn more from Regoci in an interview he’s agreed to tomorrow…Rodadero is certainly going in the right direction, and this type of discovery can gain some quick momentum on results and sudden events…what this has going for it is scale, high-grade, shallowness of mineralization, and the fact a major would be interested enough to make a second visit and sign a C/A…this confirms a lot…if you look at the history of GGI, they hit big on Temoris in Mexico in 2009, this could ultimately turn out to be a bigger version of that given the scale involved…

    Comment by Jon - BMR — October 23, 2014 @ 4:41 pm

  13. The way the stock has gone in the last few weeks and the markets overall, this is defiantly a bright spot.jon can you find a couple of minutes to ask about the grizzly as well? I’m sure I’m not the only one who wants to hear about what’s going on there as well..update soon????

    Comment by Tombc — October 23, 2014 @ 5:12 pm

  14. We’ll be asking about that for sure, Tom…btw, just saw a great article in Resource World magazine today (just out) on the Hat and the Grizzly…GGI continues to make steady progress up there, and of course DBV is coming off its best hole yet, and I’m sure at the right point soon we’ll be hearing from GGI on the Grizzly…of course there’s also La Patilla which should figure prominently into the overall equation with Garibaldi…

    Comment by Jon - BMR — October 23, 2014 @ 6:16 pm

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