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Gold has traded between $1,214 and $1,229 so far today…as of 8:00 am Pacific, bullion is down $4 an ounce at $1,223…Silver is up 4 cents at $17.13…Copper is up a penny at $2.96…Crude Oil is below $60 a barrel for the first time since July 2009, down more than $1 a barrel at $58.59, while the U.S. Dollar Index has retreated one-third of a point to 88.30…

Gold has had another strong week, pushing above $1,200 and through key resistance at $1,220.   HSBC commented, “One potentially important development is that Gold ETFs (exchange-traded funds) have seen some modest inflows recently.  At the very least, we can say the flood of selling evident last year has been reduced to a modest outflow in recent months. The longer Gold holds above $1,200/oz, the more it may attract fresh buying and Gold ETFs may begin to build. The impact Oil has on Gold’s direction may be even more crucial than it has been to date. The Oil decline has tended to be negative for bullion but should Oil prices move below $60 (per barrel) and the broader financial markets become worried about the impact of lower energy prices globally, then Gold may receive some ‘safe-haven’ inspired buying.”

Oil Update

Oil’s collapse is now causing some central banks to react…in a rare move, Mexico’s central bank is intervening in currency markets to bolster the peso…meanwhile, Norway’s central bank has unexpectedly cut a key interest rate to 1.25% from 1.5%, its first rate cut since March 2012…as the world’s second-biggest Oil exporter outside of the OPEC, Norway’s economy is heavily reliant on Crude…

The IEA has lowered its 2015 Oil demand growth forecast by 230,000 barrels a day to 0.9 million…it’s the 5th time in the last 6 months that the Paris-based energy watchdog has cut its demand-growth forecast…its highly-anticipated monthly market report also said that the Oil price rout wouldn’t boost demand as much as analysts had hoped…

Silver Demand Forecast To Grow Nearly 30% Within 4 Years

Growing industrial applications for Silver will increase demand for the metal by 27% within the next 4 years, according to a report released this week by the Silver Institute…the report, prepared by a London-based metals consulting firm, said Silver demand is expected to grow by 142 million ounces by 2018 compared to 535 million ounces used in 2013…the report highlighted 8 specific sectors where they see Silver demand growing in the next 4 years: batteries, ethylene oxide, medical, bearings, nanotechnology, automotive, printing and silver inks, and photovoltaic solar panels…

House Passes $1.1 Trillion Spending Bill To Fund U.S. Government Through September 2015

Congress avoided a government shutdown last night after House Republican leaders scraped up enough support to overcome opposition from both sides of the aisle and pass a $1.1 trillion spending bill by the slimmest of margins…to prevent even a brief shutdown, both chambers passed a 2-day stopgap measure…the Senate is expected to pass the spending bill by tomorrow…among the most controversial provisions in the bill is language that would make it easier for banks to engage in derivatives trading, and a rider prohibiting the federal government from designating the sage grouse as an endangered species (impacting western mining and Oil and gas)…

Canadian Household Debt Well Above U.S. & Others

U.S. families’ debt burdens have settled at their lowest level in over a decade, putting the economy on a stronger footing relative to global rivals going into 2015…Canadian household debt, however, continues at high levels…

Total U.S. household debt, when measured as a share of disposable income, has fallen from a peak of 135% in late 2007 to 108% this year through September, according to a Federal Reserve report yesterday…that’s the lowest sustained level since early 2003 and far below levels among households in Canada, Japan, France, Germany and Italy as you can see in this chart from The Wall Street Journal…

Today’s Equity Markets

Asia

Asian markets were mostly higher overnight…China’s Shanghai Composite gained 14 points to finish a volatile week at 2939…China’s industrial production rose 7.2% on year in November, below expectations for a 7.5% increase in a Reuters poll and down from October’s 7.7% rise…meanwhile, retail sales rose 11.7% on year, slightly more than expected…fixed asset investment for the January-November period increased 15.8%, in line with expectations…

Japan’s Nikkei average snapped a 3-session losing skid and climbed 114 points overnight…polls show Prime Minister Shinzo Abe is on track for a landslide win in Sunday’s parliamentary elections…

Europe

European markets are down sharply in late trading overseas on concerns over Oil’s drop…

North America

The Dow is off 178 points as of 8:00 am Pacific…

U.S. consumer sentiment rose in December to a near 8-year high on improved prospects for jobs and wages and on lower gasoline prices, a survey released this morning showed…the Thomson Reuters/University of Michigan’s preliminary reading on the overall index on consumer sentiment for this month came in at 93.8, the highest reading since January 2007 and above the median forecast of 89.5 among 70 economists polled by Reuters…the final November reading was 88.8…

Meanwhile, a gauge of U.S. inflation fell last month, reflecting a sharp drop in energy costs and little price pressure elsewhere in the economy…the PPI index for final demand, which measures changes in the prices firms receive for their goods and services, decreased a seasonally adjusted 0.2% in November from a month earlier, according to the Labor Department…stripping out food and energy costs, producer prices were unchanged in November…

The TSX has fallen 102 points as of 8:00 am Pacific while the Venture is off another 10 points at 653 as of 8:00 am Pacific…

CRB Index Chart Update

The CRB Index is off more than 20% from its yearly high, but likely still has further to drop despite the already oversold conditions…the good news is, certain technical indicators are at levels only seen at important lows during 1999, 2001 and 2009…

A strong support band exists between 230 and 240, which suggests potential near-term downside potential of another 5% or so…the CRB is down another full point as of 8:00 am Pacific at 244.44…

Copper Chart Update

Copper has not been able to overcome stiff resistance at a downtrend line in place since 2013, and is trying to hold on to key support around $2.90…ultimately, Copper will take the path of least resistance and either push above the downtrend line or break decisively below $2.90…

Canadian Dollar Chart Update

The decline in Oil has been taking its toll on the Canadian dollar which still faces significant downside risks, especially if the 85-cent support level does not hold…a drop into the 70’s during 2015 can’t be ruled out…

This 10-year monthly chart shows gradual down momentum in the RSI(14) since the middle of 2011, though there was a brief uptick during the first quarter of this year…

North American Nickel Inc.  (NAN, TSX-V) Update

Nickel is 1 commodity that has performed well over the last 6 weeks, and it’s up again this morning to nearly $7.50 a pound…

Bottom-fishers may wish to keep an eye on North American Nickel Inc. (NAN, TSX-V) which turned out to a great opportunity last year at this time around the same price as it now…NAN has been basing around the 22-cent level since late September, and is a good candidate in our view to rally higher early in 2015…as always, perform your own due diligence…

NAN, which had $7 million in working capital at the end of September, is unchanged at 21.5 cents as of 8:00 am Pacific…

Blackbird Energy Inc. (BBI, TSX-V)

Venture Oil and gas plays have not yet hit a low, as evidenced by the chart for Blackbird Energy (BBI, TSX-V)…

RSI(14) is moving rapidly toward previous support as shown in this 2-year BBI weekly chart, implying more sell pressure which we’re seeing this morning…a band of Fib. support stretches from 17 to 22 cents, and within that area is where BBI may stabilize…

BBI is off 2 pennies at 23.5 cents as of 8:00 am Pacific…

Note:  John, Terry and Jon do not hold share positions in NAN or BBI.