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Gold has traded between $1,159 and $1,174 so far today…as of 8:30 am Pacific, bullion is up $2 an ounce at $1,169…Silver has added 16 cents to $16.05…Copper has surged 8 cents to $2.65…Crude Oil is off 86 cents a barrel at $43.80 while the U.S. Dollar Index has rebounded more than a full point to 99.05…

As expected by most observers, the Fed yesterday removed the word “patient” from their forward guidance on interest rates (essentially irrelevant), but the overall tone of their fresh policy statement, and Janet Yellen’s briefing immediately afterward, was cautious and more dovish than generally anticipated…the dollar sold off sharply as a result…however, it remains to be seen if the Fed has effectively put the dollar into a much-needed “cooling off” period after the currency’s parabolic move since last summer…

The Fed tripped up the dollar bulls yesterday, but perhaps only temporarily…the Fed’s statement didn’t comment directly on the greenback but highlighted some of the affects of a stronger dollar…“export growth has weakened…inflation has declined further below the Committee’s longer-run objective”, and the “Committee continues to monitor inflation developments closely.”

The Fed modestly lowered its overall economic growth forecast and also moved the goalposts for employment, suggesting there is much slack in the labor market in spite of a 5.5% unemployment rate…

In her news conference, Yellen did state, “We are taking into account international developments” in currencies, and cited the “depressing influence” of the dollar’s rise on inflation, as well as exports…

And in typical Fedspeak (what American economist Alan Blinder called a “turgid dialect of English” used by Fed chairmen in making wordy, vague and ambiguous statements), Yellen made sure to add, “Just because we removed the word ‘patient’ does not mean we will become impatient.”

Good grief…we can only hope the Fed really knows what it’s doing and has a proper handle on things because the Fed, along with other central banks around the globe, are playing with fire…

Before the Fed “moment” yesterday, futures were pricing in a 55% chance of a rate rise in September…the probability of a move is now put at 40.3%, according to Bloomberg calculations…those numbers will likely bounce around a lot in the coming weeks as fresh economic statistics are released…

What the dollar bulls still have in their favor, however, is the broad perception that a rate hike is very possible, especially during the second half of this year, and the fact that the U.S. central bank is on a monetary path that is quite different than the one being followed by so many other central banks across the globe…

How the dollar and commodities close the week will be important and revealing…

Oil Update

Kuwait’s Oil minister said today that he’s concerned by the 50% drop in Oil prices since last summer because of the impact on the Gulf Arab state’s budget, but Ali al-Omair reiterated to reporters that OPEC had no choice but to keep output steady…in a very telling quote, the Oil minister stated, “We don’t want to lose our share in the market.”

Key OPEC countries are focused on market share and if that means significantly lower prices to squeeze out American and other producers, so be it…Crude Oil is battling extremely challenging fundamentals and technicals, not to mention the prospect of an even higher greenback…

Gold 6-Month Daily Chart And 10-Year Treasury Yield Comparative

The sharp increase in the U.S. 10-Year Treasury yield from the end of January to the beginning of March was a major headwind for Gold, but that pattern may now have reversed with the yield falling back below 2% and trending lower (the yield reacted very close to its declining 200-day moving average)…

The other encouraging aspect of this chart for Gold bulls is the “W” pattern – what appears to be a classic reversal formation – in the RSI(14)…weekly closes are important, so how bullion behaves the rest of today and tomorrow will provide valuable clues as to how it may finish the month of March…a band of support between $1,130 and $1,150 is very strong – then there’s also the bottom of a downsloping flag around $1,100 that should protect Gold in the event of a breach of last November’s low…

CRB Index Update

The CRB Index, though it’s off a couple of points this morning, may have touched at least a temporary bottom yesterday when it swung between a wide range, reversing at the 207 level and closing up more than a point at 212…

Again, trading today and tomorrow will be critical in assessing if an imminent recovery could be in the works after a 10% decline since mid-February…the double bottom reversal pattern, the bullish hammer, and the RSI(14) divergence with price are all positive indicators at the moment – there needs to be some follow-through in the coming days to confirm a change in trend…

Today’s Markets

Asia

China’s Shanghai Composite hit a fresh 7-year high overnight, closing up 5 points at 3583…Japanese stocks were down slightly due to a stronger yen…

Europe

European stocks were mixed today…the ECB’s recently launched full-blown QE program has already eased financial conditions and should contribute to a gradual recovery in the euro zone, the bank said in its economic report today.  “Growth in activity is expected to increase on account of the recent improvements in business and consumer confidence, the sharp fall in oil prices, the weakening of the effective exchange rate of the euro and the impact of the ECB’s recent monetary policy measures,” the ECB said.  “The accommodative monetary policy stance—substantially reinforced by the (asset-purchase program)—is expected to support real GDP growth in both the short term and beyond,” it said.

North America

The Dow is down 83 points as of 8:30 am Pacific after yesterday’s intra-day reversal and big run-up following the Fed announcement and Yellen’s news conference…in Toronto, the TSX has fallen 48 points while the Venture is down a point at 655 through the first 2 hours of trading…

Venture 4-Month Daily Chart

No dramatic changes in this Venture chart, but the bearish short-term trend is weakening (ADX indicator) at the moment…RSI(14) has bounced off the 30% level while critical Fib. support in the low 650’s has held so far this month despite several negative influences…the Dollar Index remains the key – Venture support is not likely to hold if the Dollar Index takes off above resistance at 100…

Amarc Resources Ltd. (AHR, TSX-V) Update

If one looks hard enough, quality opportunities on the Venture do exist in the current market climate…Amarc Resources (AHR, TSX-V) is an excellent example as we’ve been stating for the last few months and as recently as a week ago when AHR was trading at 11 cents…

In British Columbia, we expect the Sheslay district to heat up profoundly with the potential for near-term new discoveries and a major reinterpretation of what’s unfolding at Doubleview Capital’s (DBV, TSX-V) Hat Project…

Further south in the Cariboo region, meanwhile, Amarc is garnering increased attention as predicted following its announcement in late November that was overshadowed by the overall market turmoil at the time…

Volume has picked up significantly in AHR this month, and the company has the funds to carry out a follow-up round of drilling…AHR traded as low as 6.5 cents in December and touched 17 cents in early trading this morning (for those following the Sheslay district, keep that in mind – a fireworks show like we haven’t seen there yet is going to light up the northwest B.C. skies)…

In late November, Amarc reported highly encouraging results from an initial 9-hole drill program at the company’s IKE Project in the Cariboo region…this is an early-stage bulk-tonnage porphyry Copper-Molybdenum-Silver discovery in the heart of a producing area…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…AHR can be expected to aggressively follow up on this discovery…

John’s 3-year weekly AHR chart shows a “Big Picture” bullish trend with a confirmed breakout above the 10-cent level with the stock now threatening to overcome chart resistance at 15 cents…buy pressure has recently replaced a long period of sell pressure…

AHR is up 1.5 cents at 16.5 cents through the first 2 hours of trading today…

International Montoro Resources (IMT, TSX-V)

We suggest our readers perform their due diligence on International Montoro Resources (IMT, TSX-V) which has a very compelling Nickel target (about to be drilled) at its Serpent River-Pecors Project near Elliot Lake in northern Ontario…originally, Uranium was the focus at this property but some important work by the Ontario Geological Survey has provided strong evidence that a large anomaly (Pecors) could be the result of contact style Ni-Cu-PGE mineralization similar to that found to the east at Sudbury…significantly, that’s the independent interpretation of the OGS…sediment sampling has also shown high levels of Nickel and Chromium, lending further weight to the new analysis…

IMT is a very capable group led by President and CEO Gary Musil who has done an admirable job of moving Highbank Resources (HBK, TSX-V) forward during challenging market conditions the last couple of years…

Technically, IMT has been trading within a horizontal channel between 5.5 cents and 9 cents over the last 6 months, setting up a potentially bullish scenario…the company has the funds to imminently commence drilling the intriguing Pecors anomaly…

IMT is off half a penny at 7.5 cents as of 8:30 am Pacific…

Note:  John, Terry and Jon do not hold share positions in AHR or IMT.