Gold has traded between $1,086 and $1,098 so far today…as of 8:30 am Pacific, bullion is down $9 an ounce at $1,092…Silver is off 3 cents at $14.82…Copper has lost 4 pennies to $2.42…Crude Oil has slid 56 cents a barrel to $50.30 while the U.S. Dollar Index is up one-third of a point to 97.64…
Money managers have been fleeing Gold, and that likely sets the stage for at least a temporary bottom in the yellow metal in the near future…speculators are holding the smallest net-bullish bet on Gold since the U.S government data began in 2006…
Investors are also dumping Silver, Platinum and Palladium…combined net-long wagers across those metals are the lowest ever…
In an interview with Bloomberg yesterday, Goldman Sachs’ Jeffrey Currie said that he expects Gold could eventually fall below $1,000 an ounce. “With the more positive outlook on the dollar, and with debasement risk starting to fade, the demand to use Gold as a diversifying asset against the U.S. dollar becomes less and less important,” Currie stated in his interview with Bloomberg. “There is a probability that the market trades below $1,000 this year given our broader commodity view,” he added…
Currie came to the forefront in the Gold in 2013 when he warned investors to sell the metal…some market analysts noted at the time that Goldman Sachs’ negative outlook on bullion helped create the biggest decline in the precious metal in 30 years…
Crude Oil Update
The Energy Information Administration (EIA) reported this morning that Crude inventories rose by 2.5 million barrels in the last week, compared with analysts’ expectations for an decrease of 2.3 million barrels…increases were seen in all regions except for the West Coast, where inventories fell by 762,000 barrels…
Crude stocks at the Cushing, Oklahoma, delivery hub rose by 813,000 barrels, the EIA said…
In addition, perceptions for the potential of more Iranian supply following last week’s agreement on Tehran’s nuclear program, and concerns that economic worries in China and Europe will weigh on demand, have put pressure on Oil this month…
The $49 to $50 area appears to be the fault line for bulls and bears to battle it out…for U.S. production to be choked off even more, prices likely have to fall further…
Technically, as John indicated previously, a breach of the support band between $52 and $54 would push Crude lower, and $49 is key Fib. support…with increasing sell pressure, the probability of a re-test of the March low of $42.41 has become more likely…
CRB Index Updated Chart
Are we about to see a major test of the early 2009 low in the CRB Index that followed the 2008 Crash?…that’s quite possible…it’s trading at 211 as of 8:30 am Pacific, just 11 points above the 200.16 low in this 10-year monthly chart…the ADX indicator shows the trend has turned more bearish recently…
Venture-TSX Gold Index Comparative
Producers are getting clobbered more than most juniors this month with the TSX Gold Index down a whopping 18% so far here in July, while the Venture has fallen by less than half that much – 8.3%…
Interestingly, since their 2011 highs, the TSX Gold Index and the Venture have both lost three-quarters of their value – the Gold Index is down exactly 73% while the Venture is off 75% (through yesterday)…those are extreme drops – usually when markets tumble that much, it’s wise to be a contrarian even though a little more weakness is certainly possible…
Notably, the 2008 Crash knocked the Venture down 75% and some investors who were brave enough to jump in at that point made a fortune over the next 2 years…
Today’s Markets
Asia
Japan’s Nikkei average fell by more than 1% overnight, but China’s Shanghai Composite bucked the trend with a slight gain to close at 4027…
Europe
European markets were down moderately today…
North America
The Dow is off another 90 points through the first 2 hours of trading today after yesterday’s 181-point loss…Toronto, the TSX is 55 points lower while the Venture has shed 5 points to 610…support at 609 and 598…
Probe Mines Ltd. (PRB, TSX-V) Update
Investors searching for value in these turbulent markets should focus on well-managed companies who have high-quality projects and the financial strength to take advantage of unique opportunities in the current environment…
David Palmer’s Probe Mines (PRB, TSX-V) fits that category…the company, which was a spin-out from the recent Probe Mines–Goldcorp (G, TSX) deal, was sitting on more than $19 million in cash as reported April 9 after receiving a payment of $4 million from the sale of the 5% NSR royalty on a portion of the Goldex mine to Agnico Eagle Mines (AEM, TSX)…this is a a great time in the market cycle to be sitting on nearly $20 million…
With only 34 million shares outstanding, PRB’s current market cap (based on yesterday’s 35-cent close) is about 40% below its cash value…PRB has 3 properties in Ontario, including the Black Creek chromite deposit, but is likely searching for an exciting new story…
Probe has been trading only since mid-March and has retreated back to its lows…unbelievably, RSI(2) is actually now at “0” – we’ve rarely seen that before (can’t drop below 0)…RSI(14) has plunged to 19%…if investors recall, the old Probe crashed to at least a nickel during 2008 which, in hindsight, represented an opportunity to become a millionaire…
PRB is up a penny at 36 cents as of 8:30 am Pacific…base support is 35 cents…from a technical perspective, a fall below that could be like going off the cliff…that’s when a really big opportunity here would emerge for patient investors…
PyroGenesis Canada Inc. (PYR, TSX-V) Update
A stock that has held up well over the last 6 weeks, since we initially introduced it to our readers for their due diligence, is PyroGenesis Canada (PYR, TSX-V) which has been coming out with some interesting news lately including yesterday…
Back on June 8, PYR announced something that could indeed be quite revolutionary…the company has been engaged by an unnamed junior mining and metals company (??) to evaluate the feasibility of using plasma for the purpose of refining ore into pure metal, in this case converting quartz into pure silicon metal…
“The world market for silicon metal is about 1.8 million tonnes per year and ore refining represents an interesting application of our plasma capabilities,” said Pierre Carabin, PyroGenesis’s director of engineering…
So they are working on some fascinating stuff…
PyroGenesis is the world leader in the design, development, manufacturing and commercialization of advanced plasma processes, and its Plasma Atomization Process (PAP) is an enabling technology for 3D Printing…
Technically, PYR has been slowly gaining momentum an RSI(14) bullish “W” and steady accumulation (CMF) since March…in a broader contest, it has traded within a downsloping flag since late 2013 and could be gearing up for a test of resistance at the top of that flag over the next several months…
PYR is unchanged at 38 cents, a penny below Fib. resistance, as of 8:30 am Pacific…
Note: John, Terry and Jon do not hold share positions in PRB or PYR.
Jon , I was hoping to see some kind of update on DBV in today’s newsletter , I hope it’s still in the works and not on the back burner.
Comment by Les — July 22, 2015 @ 7:53 am
Les, believe me, it’s not on the backburner. We have been working exhaustively on researching and confirming facts, and you’ll start to see the results of those efforts imminently.
Comment by Jon - BMR — July 22, 2015 @ 7:57 am
Thank you Jon
Comment by Les — July 22, 2015 @ 7:59 am
Thank you Jon, you the man.
Comment by Concerned Citizen — July 22, 2015 @ 8:01 am
Thoughts on GGI anyone? How can their value be solely based on what is happening in BC right now? They have taken quite a hit in share price, yet they appear to have a growing, valuable asset in Mexico. Seems odd there is no update on Mexico – a number of outstanding assay results from drilling. Sprott selling was complete awhile ago yet share price dropping further. I understand the significance of what is happening in Sheslay and GGI’s is likely placing a focus there but they do need to be able to “walk and chew gum” at the same time as far as I am concerned. Anyone talk to Regocci?
Thank you
Comment by FrankNS — July 22, 2015 @ 8:10 am
What we need is farshad to give us an update. Give us something. If this drags on too long major investors might think the risk is too high and take money elsewhere. I have a lot of shares and am not selling a single one. I would actually like to keep buying more but I don’t know how long this will drag out and how much lower we will go.
Comment by Sam — July 22, 2015 @ 8:12 am
WOW – go to stockhouse again today and read the pictured advertisement at the top left. the one titled gold and silver. Pretty much sums up what my private club analysts told me last week. This write up on stockhouse is saying that it could last the rest of the year though, hmmmm.
Comment by dave — July 22, 2015 @ 8:20 am
Every day the same questions are being asked re DBV and Farshad. Sometimes the lack of news simply means that there is nothing beneficial to the company to press release. I suspect that this is the case and we’ll only hear directly from DBV when an agreement is reached. Both parties can grandstand all they want but it will take a signed agreement to see the stock price recover.
Comment by Ted — July 22, 2015 @ 8:26 am
Sam , how many shares do you believe it would take to be considered a major investor ?
Comment by Les — July 22, 2015 @ 8:42 am
I don’t care if the price of the stock is 5 or 10 cent. What I am interested is in finding out if both parties want to negociate with each other. I am sure that Farshad is willing but I didnt get any confirmation from Chad Day and the Tahltan.
Comment by Guy Delisle — July 22, 2015 @ 8:46 am
Ted , I have to agree it will take an agreement to reverse the trend ; but any information from DBV and BMR as a rebuttal to Chad Day’s comments will help stop the selling.
Comment by Les — July 22, 2015 @ 8:47 am
It’s an agreement with the gov’t that Day is looking for and the Sheslay mining companies are just the vehicle he is using.Imo,with the gov’t probably in summer vacation mode,this will take until the fall.Sprott didn’t just dump,they fled.
Comment by jim niles — July 22, 2015 @ 9:18 am
Agree Frank, what is going in Mexico with GGI? The reason I bought GGI was partly Mexico and partly Sheslay. Are things going poorly in Mexico? Generally no news is not good news. Having said that I picked up 100,000 at .045 today thinking we have to be close to maximum pessimism and I am a patient guy although I will express frustration at times and I am frustrated with the lack of communication from GGI.
Comment by Danny — July 22, 2015 @ 9:27 am
I would not be surprised if one of the news releases in the next couple of months from GGI indicates the sale of the Rodadero silver-gold project, much like Regoci did with the Temoris silver district property in 2009.
I believe the La Patilla project will be kept to extract the cash flow obtained from the Gainey Capital processing mill. Just my guess of course.
Comment by Andrew — July 22, 2015 @ 9:44 am
Frank, I don’t think GGI will be drilling in BC this year, and if they do, you will probably get the results early next year. Regarding Mexico, the market is telling you it’s not interested in their properties down there. The reason for that is management has kept the market in the dark. I find it hard to believe that they’ve been drilling since April (?) and have no results on hand. Add on top of that a vicious bear market that doesn’t want to end, and you have the current share price. I hope it turns out alright for you guys but the way I see it GGI and DBV are done for the year. It’s a shame because it was shaping up to be an exciting story.
Comment by chris — July 22, 2015 @ 9:57 am
I will be sticking around myself and there is no point in selling out now. This bear market (manipulated as it is by the powers to be) will not shake me out of this market or GGI. The market cap. could go lower but I believe that it will run much higher over the next year or so.
Comment by Andrew — July 22, 2015 @ 10:17 am
Chris, you could very well be right on this. The market sentiment is terrible and the lack of news from Mexico is disturbing. Any investment now you have to be patient with.
Comment by Danny — July 22, 2015 @ 10:22 am
Chris, I believe you are right. What amazes me is the pessimist on this board yet they keep saying that they bought more. Nobody is getting my cash right now. Lets hope they don’t turn out to be an RBW scenerio.
Comment by dave — July 22, 2015 @ 10:44 am
Danny, if you think there is going to be a turnaround in the precious metals next year and believe in GGI’s properties, I think it’s safe to nibble (don’t go all in yet) down here. But expect to have your money tied up for a little while. I have GGI on my radar but I am thinking of buying it during tax loss season.
Comment by chris — July 22, 2015 @ 10:54 am
Dave, the smoke will clear at the end of the year. That’s when I’ll make my move. But that’s just me. I don’t advise going all in on precious metals at this very moment, but if you’re afraid to miss a move in a given stock and have some play money burning in your pocket, I advise just to nibble.
Comment by chris — July 22, 2015 @ 10:59 am
Chris, what is it that makes you believe that DBV and GGI won’t drill this year? I’m not trying to call you out, just curious if you have some specific information that would indicate drilling won’t happen? Thanks.
Comment by Steve A. — July 22, 2015 @ 11:02 am
One more thing, I don’t advise nibbling or going all in on DBV. The play is too risky at this moment. The company has two strikes against it: 1) Chad Day situation 2)if I remember correctly there are over 2 million FT shares coming into the market in September. Jon, if I am wrong you can correct me on that because I don’t remember the exact number at this moment.
Comment by chris — July 22, 2015 @ 11:17 am
DBV information: The securities issued under the financing will be subject to a hold period expiring on July 5, 2015, in respect of 350,000 FT Units, and July 21, 2015, in respect of 2,500,000 FT Units, pursuant to applicable Canadian securities laws and the rules of the TSX Venture Exchange.
Comment by Andrew — July 22, 2015 @ 11:29 am
Chris – don’t worry, there is only 1 stock that I will nibble at and I can’t give that one out yet cause I’m not in it. When the time is right and I get in, then I will let you know. It will do well with the current situation.
Comment by dave — July 22, 2015 @ 11:42 am
Steve, Chad Day strikes as a man who has his mind set and will not budge. He wants to prove a point and he wont allow these companies to run over him. I don’t think he’s going to change his position. I hope I am proven wrong and next week there is a beautiful NR stating that an agreement has been reached. But the longer this drags on the more I am inclined to believe that a deal will not be reached. This is just my opinion, and like I said I hope I am proven wrong.
Comment by chris — July 22, 2015 @ 12:01 pm
Steve, also I don’t think politicians want to go around ruffling feathers at this stage, seeing that there is an election coming up. So they might take a laissez-faire approach to this situation. The BC government is going to have to step in sooner or later, but it’s best that DBV and Chad Day reach an agreement before that.
Comment by chris — July 22, 2015 @ 12:09 pm
I have been searching on the Tahltan Band Council website and can’t find anything on the Sheslay blockade. Could it be level heads are prevailing and there are actual negotiations between Day and DBV?
Comment by Dan — July 22, 2015 @ 3:55 pm
Sorry, wrong site. Should have searched the Tahltan Central Council. Wishful thinking I guess. Nevertheless, hopefully a resolution and drilling resumes……that mat be wishful thinking as well.
Comment by Dan — July 22, 2015 @ 4:00 pm
All comments have been removed from the Tahltan site regarding Sheslay…….so don’t know what to make of that.
Comment by Dan — July 22, 2015 @ 4:03 pm
Another blo article with direct quotes from owner. Would be nice to see official company update
Read on The Province news “Vancouver firm says marijuana breathalyzer nearly ready for use — and employers, cops are interested”…
Comment by Matt — July 22, 2015 @ 5:33 pm