Gold has traded between $1,185 and $1,197 so far today…as of 7:30 am Pacific, bullion is down $11 an ounce at $1,185 after Friday’s brisk advance…Silver is off 17 cents at $15.92 (updated Silver charts at the bottom of today’s Morning Musings)…China Silver imports rose to a 9-month high in November, reaching 244 million grams…China’s Silver imports are up 2.9% in the first 11 months of 2014 vs. a year earlier…Copper has lost 2 cents to $2.86…Crude Oil, which has fallen for 5 consecutive weeks, is up 47 cents at $55.20 amid reports of escalating clashes in Libya, a key producer…the U.S. Dollar Index has eased slightly to 90.02…
Just prior to Christmas, in what may have been due to some year-end investor portfolio juggling, holdings in the SPDR Gold Trust suffered their worst daily decline (11 tonnes) since July 2013…HSBC said the drop in holdings is a reminder that ETF redemptions are still a risk to the Gold market…
Copper prices are now at their lowest level since June 2010, a sign of investors’ skepticism about China’s efforts to kick-start its economy…last week, China’s central bank announced it was relaxing a major restraint on lenders’ ability to use deposits to make loans, a move aimed at spurring economic growth…a series of stimulus measures in recent months – more are expected – have so far failed to give the Chinese economy a significant bump…the country accounts for about 40% of the world’s Copper consumption…
Gold – Second Best Global Currency In 2014
With all the negativity surrounding Gold, especially in North America, it’s important to keep in mind that bullion has been the second best performing global currency in 2014…Frank Holmes, CEO of U.S. Global Investors, pointed this out in his latest weekly Investor Alert at www.usfunds.com.
“It is important to point out why investors hold Gold. Aside from the dollar, Gold has been the best performing currency in 2014. For those who hold most of their assets in dollars, the beauty of Gold may go unnoticed. However, for those in Russia who just saw half of their wealth disappear with the depreciation in the ruble, the benefits of Gold are clear. This year provided investors with the perfect case study for highlighting the importance of Gold.”
Today’s Equity Markets
Asia
Asian markets were mixed overnight…China’s Shanghai Composite briefly broke above resistance at 3200, hitting its highest level since December 2010, but backed off near the end of the day and closed up 12 points at 3169…
Japan’s Nikkei average surrendered early gains and finished down 89 points at 17730…
Europe
European markets are mostly modestly lower in late trading overseas, though Greek stocks took a pounding today – Athens was down more than 10% after politicians failed for a third time to elect Prime Minister Antonis Samaras’ preferred candidate…this means that early general elections will happen next year, opening door to a potential victory for the hard left Syriza Party which is currently leading in the polls…Syriza is appealing to Greeks angry at the ruling coalition for imposing years of austerity as a requirement to secure international aid…elected to a four-year term in mid-2012, Greece’s current coalition government – composed of the conservative New Democracy and the socialist Pasok parties- wasn’t due to face elections again until June 2016…Syriza’s agenda, if its is followed through on, is sure to screw up the economic progress made in Greece over the last year-and-a-half..
North America
The Dow is relatively unchanged as of 7:30 am Pacific…the TSX has added 71 points while the Venture is up 2 points at 676…
Venture Updated Chart
The Venture’s modest recovery from its December 16 all-time low continues…
John’s updated 9-month daily chart shows the intense oversold conditions that prevailed over much of the last 4 months after a breakdown in September of the symmetrical triangle, a drop below key support levels and a reversal to the downside in the 200-day moving average (SMA)…this was a classic technical collapse, and it mirrored what happened in Crude Oil though the Venture led the way…
What the Venture is telling us now is that it’s ready to test a band of resistance between 700 and 800…sell pressure is declining, and an RSI(14) divergence with price occurred this month which is consistent with normal type of rally that we would expect to see at this time of the year…some fresh catalysts will be needed for the Venture’s current momentum to continue through all of January into February…
Doubleview Capital Corp. (DBV, TSX-V) Update
As we pointed out Christmas Eve, Doubleview Capital Corp. (DBV, TSX-V) has just drilled the deepest hole ever in the Sheslay district…in a way, this has a similar feel to the situation a year ago when DBV quietly issued news before Christmas on the completion of 5 holes totaling 1,276 meters (just weeks later, on January 20, DBV commenced a breakout that would ultimately take it 40 cents on the announcement of discovery holes HAT-08 and HAT-11)…
In this case, DBV has drilled just 1 hole but to an impressive depth of 650 m (drilling was halted at 650 m in HAT-23 and possibly could be extended even deeper beginning in January)…the question is, what would compel the Doubleview geological team and management to drill such a deep hole, especially considering a tight budget?…
A total of 263 core samples were taken from HAT-23 and sent to the lab for analysis (results potentially could be available in time for the 20th anniversary of the Vancouver Resource Show January 18-19)…this compares with 386 samples from 1,276 meters of drilling in the 5 holes in late 2013…
According to the drill plan map on the Doubleview web site, HAT-23 was collared approximately 110 meters east of HAT-22 which delivered the highest grades yet at the Hat Project…it seems likely that HAT-23, drilled in a north to south direction, has significantly expanded the width of the Lisle Zone…the key will be if this hole can intersect even higher grades than HAT-22 which returned an interval of 118.4 m grading 0.55% Cu and 0.41 g/t Au (0.80 CuEq) within an overall mineralized section (between 43.4 and 447.6 m) of 404.2 m @ 0.25% Cu and 0.25 g/t Au…
Each round of drilling at the Hat has produced better results, so there’s reason for optimism with regard to HAT-23…
Below is an updated DBV chart…it’s strange that many investors would rather buy at overbought levels than oversold levels, but that’s part of the strange psychology of the market…
The secret to success in the market, of course, is buying low and selling high…DBV is trading near the bottom of its 12-month range, and Fib. support at 11 cents appears to have held…interestingly on this 2-year weekly chart, steady accumulation has been occurring in DBV over the last 3 months…
DBV is off a penny at 13 cents through the first hour of trading today…many may chase this again come January…
Amarc Resources Ltd. (AHR, TSX-V) Update
In British Columbia, besides the Sheslay district and the recently announced important discovery at Kemess East by AuRico Gold Inc. (AUQ, TSX), investors should keep a close eye on Amarc Resources (AHR, TSX-V) which should garner increased attention in the early part of 2014 following its announcement November 24 that was overshadowed by the overall market turmoil at the time…
Amarc reported highly encouraging results from an initial 9-hole drill program at the company’s IKE Project in the Cariboo region…AHR has an early-stage bulk-tonnage porphyry Copper-Molybdenum-Silver discovery on its hands in the heart of a producing area as all 9 holes intersected chalcopyrite and molybdenite mineralization from surface and over a broad area measuring 1,200 m east-west by 600 m north-south and to depths of approximately 500 m…
Interval highlights included 247 m grading 0.42% CuEq in IK-14-001; 234 m @ 0.43% CuEq in IK-14-002; and 308 m @ 0.41% CuEq in IK-14-006…these results, along with post-drilling geological, geochemical and geophysical surveys completed outward from the drilled area, indicate that the IKE porphyry system has the potential to host a significant resource…this is still early in the game and AHR can be expected to aggressively follow up on this discovery which should help underpin the share price…
As we stated when the results were announced November 24, December might be a great time for accumulation of AHR following this news given tax-loss selling pressures and overall market weakness…indeed, AHR dipped as low as 6.5 cents but has since firmed up again…
John’s 3-year weekly AHR chart shows a “big picture” bullish trend with buy pressure recently replacing a long period of sell pressure…expect the resistance at 10 cents to be overcome…
AHR is up a penny at 11 cents as of 7:30 am Pacific…
Calibre Mining Corp. (CXB, TSX-V) Update
Calibre Mining (CXB, TSX–V) has been a strong out-performer in 2014, a trend that seems likely to continue in the year ahead…
A healthy technical consolidation occurred in Calibre during October and early November after quite a dramatic run that began near the end of May…support held, as expected, between the 9 and 12-cent Fib. levels…
Results from a 5,000-meter Phase 1 drill program at the Eastern Borosi Gold-Silver Project, financed by IAMGOLD Corp. (IMG, TSX) have so far been very encouraging, and more assay results are pending…
Meanwhile, at the end of October, CXB announced commencement of a Phase 1 diamond drilling program (1,500 meters in up to 13 holes) on the Minnesota Gold Project within the B2Gold Corp. (BTO, TSX) joint venture on the Borosi concessions, northeast Nicaragua…Calibre controls a 49% interest in the JV while B2Gold has a 51% interest and is project operator…BTO has the right to earn an additional 19% per cent in Borosi by spending $6 million in additional project expenditures over 3 years…
CXB is unchanged at 15 cents (Fib. resistance) as of 7:30 am Pacific…RSI(14) is showing strong up momentum and the stock has broken above its 50-day SMA which is flattening out at 13 cents…
Silver Short-Term Chart
Silver has finally staged a definitive breakout above a downtrend line that was in place since the summer on this 9-month daily chart…the December 1 dramatic move from an intra-day low of $14.15 to a close above $16 was technically highly significant…as expected, superb support has been demonstrated around $15 and Silver made a recent run toward near-term resistance at $17.50 before backing off to current levels around $16…
Note how the downtrend line has become new support, while there’s also near-term support around $15.60…RSI(14) is moving up from a bullish “W”, a positive sign, so the immediate trend appears positive despite today’s weakness…
Silver Long-Term Chart
This 34-year monthly chart continues to give hope that Silver could be preparing for a powerful “Wave 5” move to the upside, though we caution that this could take some time to play out (if indeed this theory is correct)…
RSI(14) has bounced off previous long-term support which will need to hold along with key price support in the immediate vicinity of $15…
Fundamentally, Silver has been hurt by a slowdown in global economic growth…if economies in the euro zone, China and Japan can show some fresh strength in 2015 (and that’s a big “if”), Silver could begin to appreciate rapidly…
One note of concern on this chart is the sell pressure that has prevailed since the beginning of 2013, after a decade-long period of buy pressure…based on historical patterns, sell pressure could persist for a considerable time yet…
Note: Jon holds a share position in DBV.
I figured we would see some higher volume on a lot of stocks I’m watching, but its not the case. Only the tech momo’s that have been hot are having the volume. A shortened week and people on vacation probably the reason. Cmon January and 2015.
Comment by dave — December 29, 2014 @ 9:14 am
Yes, Dave, liquidity is light, we’re seeing that in the Gold market as well. It will improve during the week of the 5th and everyone will certainly be in full swing by the week of the 12th.
Comment by Jon - BMR — December 29, 2014 @ 9:24 am
Gold Canyon is an exception to the quiet period. 5.7 mil shares traded so far. Pinetree has been mentioned as a seller over last few trading days.
Comment by Tom UK — December 29, 2014 @ 11:02 am
Jon, I wonder why Raymond James is taking a dump on GGI. Ya think they got wind of a bad news release coming?
Comment by dave — December 29, 2014 @ 12:05 pm
Raymond James is a poor measuring stick in terms of GGI news, Dave, if you go back to their selling since late August and earlier (historically), so I don’t think that has anything to do with anything other than somebody wanting to raise some cash. It’s not hard to read between the lines, given core descriptions and photos and other info, that a deposit is growing at Silver Eagle, and the opportunities elsewhere within the Rodadero package are huge. Then of course there’s B.C. and GGI is the best positioned financially to make inroads at Sheslay. So there shouldn’t be anything but very good news coming out of GGI. RSI(2) was high in overbought territory on the daily chart entering today (now it’s back in the oversold range), and the stock hasn’t had a down day on the Venture since Dec. 16 – so that is a better explanation of the minor weakness seen today. Normal trading. Actually closed up today on the OTC on 32,000 shares, so 118 K traded altogether today which is nice to see.
Comment by Jon - BMR — December 29, 2014 @ 1:28 pm
sounds good Jon. I don’t know why a house would dump 75k shares in a stock with a lot of potential, thats just crazy to me.
Comment by dave — December 29, 2014 @ 2:48 pm
Don’t forget Dave, their was a buyer for every share James dumped, I agree with Jon end of the year needed cash, their loss, the worst news I can see comming from ggi is that maybe they ran out of drill bits. To much going on here to get out now, I’ve waited this long, little longer is fine with me. Like the year end message from regoci says, shareholders will be rewarded.
Comment by Tombc — December 29, 2014 @ 3:40 pm
Just wondering if you have had a recent update on Cannabix (BLO). I couldn’t help but notice some big bids showing up today which is a very encouraging sign on what is generally a light trading day.
Comment by Danny — December 29, 2014 @ 4:25 pm
Hi Danny, we’re of course always keeping an eye on BLO and we’ll be doing an update very soon. I like it a lot for 2015.
Comment by Jon - BMR — December 29, 2014 @ 5:54 pm