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Gold has traded between $1,201 and $1,213 so far today…as of 8:30 am Pacific, bullion is off $5 an ounce at $1,203…Silver has lost 34 cents to $16.49…Copper is down 3 pennies at $2.73…Crude Oil has fallen $2.39 a barrel to $51.59 while the U.S. Dollar Index is flat at 97.89…

Despite Gold’s minor pullback since Monday, HSBC analysts say the near-term outlook is encouraging given the prospect for further consolidation in the U.S. dollar…another factor supporting the Gold market are mixed messages from Federal Reserve officials, like Minneapolis Fed President Narayana Kocherlakota, on when a rate hike may be put in motion by the central bank. “Mr. Kocherlakota said that it would be appropriate for the Federal Open Market Committee to defer the initial interest rate hike until the second half of 2016,” HSBC analysts wrote, adding that market watchers will be keeping a close eye on the FOMC minutes due for release this afternoon…

Gold Bandits

McEwen Mining (MUX, TSX, NYSE) has reported an armed robbery at its El Gallo 1 mine, located in Sinaloa, Mexico…the company said an “estimated 900 kilograms of Gold-bearing concentrate containing approximately 7,000 ounces of Gold were stolen from the refinery.  The crime is being vigorously investigated by the Mexican authorities.”

Using current U.S. Gold prices, the theft translates into roughly $8.5 million…while McEwen Mining said they are insured, the full loss won’t be fully covered…fortunately, no employees were seriously injured and mining operations have not been halted…

Oil Update

Oil prices have weakened this morning due to continuing supply concerns…the EIA (Energy Information Administration) reported that U.S. Crude inventories rose by 10.9 million barrels in the week ending April 3…analysts surveyed by Reuters expected an increase of 3.4 million barrels…U.S. commercial stocks extended their record build for a 13th consecutive week, putting total inventories at 482.4 million barrels…adding to concerns is that Saudi Arabia reported record output in March…

Today’s decline in prices followed a rally yesterday when WTIC approached 2015 highs following government forecasts for lower U.S. Crude production growth and higher global demand for Oil…

Technically, despite this morning’s weakness, strength is still apparent in John’s WTIC 2-year weekly chart…the 50-day moving average (SMA), currently $49.77, is reversing to the upside and new support has been established at the $50 level…

RSI(2), at 94% after yesterday, needs to unwind but the possibility of this rally extending further from last month’s low of $42.41 can’t be ruled out over the coming weeks…there’s still no guarantee, however, that we’ve seen the final low in Crude prices based on technical and fundamental factors…short positions will likely ramp up again if WTIC were to rally to the $60 area…a Goldman Sachs report yesterday warned that prices need to remain low for months to slow U.S. Oil output growth…

Updated Euro Chart

Yesterday, we examined the U.S. Dollar Index which is clearly in a consolidation phase…this morning, a 7-month euro chart adds more weight to the analysis that the greenback is likely going to trend lower in the near future as it continues to digest its large gains since last summer…

A euro rally started last month after the currency hit long-term support amid extreme oversold conditions at 105…it closed yesterday at 108…a continuation of this rally, which seems likely given the current indicators, could easily take the euro up into a cluster of Fib. resistance between 112 and 117…that would mean the Dollar Index would break below 96, a bullish dynamic for commodities and the Venture…

Today’s Equity Markets

Asia

Markets in China and Japan roared to new multi-year highs overnight…the Shanghai Composite gained another 34 points to close just shy of 4000, while Japan’s Nikkei added 149 points to finish at 19790…

This is what can happen when a market breaks out like the Shanghai did last summer…next measured Fib. resistance is just below 4100, so expect the Shanghai to power higher within the upsloping channel…

Europe

European markets were modestly lower today…

North America

The Dow has gained 27 points as of 8:30 am Pacific…Fed minutes will be released at 11:00 am Pacific…in Toronto, the TSX has added 34 points while the Venture is off 2 points at 687…NexGen Energy (NXE, TSX-V) has retreated 3 pennies to 54 cents as of 8:30 am Pacific…John has an updated NXE chart at the bottom of today’s Morning Musings following yesterday’s unconfirmed breakout above resistance at 52.5 cents…NXE continues to make excellent progress at its 100%-owned Rook 1 Property in the Athabasca Basin…

Fairmont Resources Inc. (FMR, TSX-V) Update

Interesting news just out from Fairmont Resources (FMR, TSX-V) this morning, a company we’ve been tracking closely since the beginning of the year with excellent growth potential in the industrial minerals sector…

Fairmont has completed the first blast (15–20 tonnes) at its Buttercup Property (a Certificate of Authorization from Quebec authorities for the Buttercup was received last December, allowing for the annual production of up to 300,000 tonnes of titano-magnetite aggregate from the property)…some of this material has been sent to a “large private Canadian industrial minerals company for dense aggregate testing”, so FMR appears to be making inroads as far as courting potential customers is concerned – that is certainly key…

With less than 20 million shares outstanding, and a market cap of just $2 million based on yesterday’s closing price (12 cents), we see plenty of upside potential here as the company’s business model gains traction through the rest of this year…Fairmont has a suite of industrial mineral properties in Quebec, all surrounded by excellent infrastructure, and we’ll be educating our readers on these in the weeks ahead…

International Montoro Resources (IMT, TSX-V) Update

Fundamentally and technically, International Montoro Resources (IMT, TSX-V) is uniquely positioned as April unfolds with a fully-funded drill program in progress, 24/7, that’s taking aim at an “intriguing” Ni-Cu-PGE target as confirmed by the Ontario Geological Survey…IMT has broken out of a 7-month horizontal channel (see updated chart below) at the same time as drilling is nearing the potential “sweet spot” of what’s postulated to be a large mafic intrusive body, beneath Huronian rocks, hosting Ni-Cu-PGE mineralization similar to that found to the east at Sudbury…geological theories, of course, don’t always prove to be correct, but the evidence here is highly compelling…juniors often move on mystery and speculation, and there is a mountain of that here…

The intense and massive Pecors anomaly (7 km long, 3 km wide and 2 km deep) in the heart of northern Ontario’s Elliot Lake mining camp (now drawing some interest from the Chinese, by the way) was initially identified through a geophysical survey (VTEM) conducted in part by IMT…importantly, the OGS, fascinated by this anomaly, then conducted a high-density lake sediment and geochemical survey in the region which led to the interpretation that the Pecors anomaly is very likely the result of contact style Ni-Cu-PGE mineralization, as opposed to an iron formation as initially thought…

“The geochemical evidence from this lake survey indicates excellent potential for the discovery of new mineral occurrences,” the OGS stated in its 2010 report (Open File Report 6251).  “In particular, the potential for VMS and magmatic Cu-Ni-Cr-PGE mineralization is very high.”

A 3D interpretation of the target has allowed geophysicists to see how this structure appears to be laying and the direction it’s pointing…based on the intensity of the airborne survey, IMT’s technical team was able to pinpoint what appears to be the center of the anomaly with the first drill hole…

Pecors has never been properly drill-tested – of course, the geophysical anomaly wasn’t even known to exist until just a few years ago…interestingly, however, when Rio Algom was drilling for Uranium in the district more than half a century ago, log data shows they did drill a few holes at Pecors that terminated around 600-700 meters within wide intercepts of gabbro, including rock described as “quartz gabbro”, which the OGS says helps validate their theory…again, Rio Algom was looking for Uranium and completely missed the possibility they were actually closing in on a new Nickel-Cu-PGE discovery…that’s often how it works in the business of exploration…

IMT 1.5-Year Weekly Chart

What’s most significant about this IMT chart is the confirmed breakout above the horizontal channel that has been in place since October of last year…RSI(14) at 60% has formed a “W” and has plenty of room to move higher, while all the moving averages are in bullish alignment…the technicals match up with the momentum this company has on the ground right now…

Garibaldi Resources Corp. (GGI, TSX-V) Update

As we continue our series on Garibaldi Resources’ (GGI, TSX-V) high-grade discovery at its Rodadero Silver-Gold Project in central Sonora State, it’s interesting to note how the development of Rodadero has mirrored that of Yamana Gold’s (YRI, TSX) Mercedes mine to the northwest in north central Sonora State when it was in its early discovery stages in the 1990’s…

By 2000, surface and underground mapping and sampling had revealed 11 separate target areas (several of them had small-scale historic mining activities) at Mercedes, vs. the 12 that now exist at Rodadero including 1 (Silver Eagle) where a high-grade drilling discovery has been made near-surface…

What really kick-started Mercedes was when drilling went to depth and a bonanza grade ore shoot was discovered in 2005 (M05–031 returned 21 m grading 28.44 g/t Au and 245 g/t Ag between a depth of 186 m and 207 m)…Yamana took control of the project in 2007, quickly outlined a substantial Gold and Silver resource, and now Mercedes is in production as mostly an underground operation…

Four main vein systems (Mercedes, Barrancas, Klondike-Rey de Oro and Duluvio-Lupita) have been discovered in that district within a 4 km by 6 km block…3 of those areas outcrop, while the discovery of the Barrancas vein under the post-mineral Baucarit Formation is a significant advance for Sonora exploration…interpretation of aeromagnetic survey data indicates that there are multiple untested targets within a 25 km by 20 km block around the property, mostly in covered areas…

Gold-Silver mineralization at Mercedes is hosted within low sulphidation veins, stockwork and breccia zones…

At Rodadero, so many possibilities currently exist given the types of mineralization found throughout the property and the extent of mineralization (the number of targets) as Dr. Craig Gibson emphasized in our recent interview (see Monday’s Morning Musings)…

Garibaldi continues to have success with shallow drilling but it’s the deeper drilling that potentially could unlock the kind of discovery that compares to Mercedes to the northwest…

“Our geological consultants have looked at all those different mineralized centers and they’re confidently appreciating the fact that these may very well be surface expressions of a much larger system at depth, – that’s the kind of framework we’re developing,” President and CEO Steve Regoci told BMR.

“The secret to Rodadero is the scale of it,” Regoci continued.  “We’re in a discovery process.  A lot of people suggested that we made a discovery with the first hole at Silver Eagle.  Yes, but we’re in a very, very large system as our latest news states.  There are going to be a number of bodies I think that are all connected at depth.  The structures are there.  Everything’s lined up along these crosscutting structures.  There has been a huge amount of pressure and fluid driven through here.  I’m really excited about what this is going to evolve into.  It’s not just about Silver Eagle.  It’s not just about Tarichi.  It’s about Rodadero.  It looks to me like a mineral complex that could be a world class situation for our shareholders.”

NexGen Energy Ltd. (NXE, TSX-V) Update

NexGen Energy (NXE, TSX-V) has been pushing higher since announcing March 31 that it has drilled off-scale radioactivity (greater than 10,000 counts per second) approximately 3.7 km northeast and along trend from the Arrow zone on its 100%-owned Rook I Property in the Athabasca Basin…a 4th drill rig, recently mobilized to the property, has joined 1 other drill rig in testing this new discovery, named Bow, which is coincident with a recently located radon anomaly that tracks the strike of a VTEM conductor for approximately 730 m and is up to 140 m wide (this particular radon anomaly has the highest reading of all known radon anomalies in the area)…

NexGen has been quite volatile over the last year but has been following a general uptrend featuring higher lows…note how the RSI(14) has broken above its downtrend line, while the previous strong resistance around 53 cents may become new support…

Note:  John and Jon both hold share positions in IMT and GGI.  Jon also holds a share position in FMR.