Gold has traded between $1,230 and $1,243 so far today…as of 9:00 am Pacific, bullion is unchanged at $1,234 an ounce…Silver is up a penny at $16.23…Copper has added 2 cents to $2.20…Crude Oil is off its lows, down just 41 cents at $39.95 a barrel after major Oil producers failed to come to an agreement over the weekend on an output freeze, while the U.S. dollar has retreated one-fifth of a point to 94.47…
Assets in SPDR Gold Trust, the world’s largest Gold-backed exchange-traded fund, rose 5.64 tonnes to 812.46 tonnes on Friday, the first increase in a week…meanwhile, hedge funds and money managers raised their bullish bets on Gold and Silver in the week to April 12, according to U.S. Commodity Futures Trading Commission data released Friday…
Citigroup said today what the charts have been telling us for several months – commodities have passed the worst of a rout amid brighter prospects for Chinese demand, a weaker dollar and signs of tighter supplies…
Silver has overtaken Gold as the year’s best performing precious metal, Bloomberg confirms, extending its gains to 17% on the back of a stabilizing Chinese economy…the precious metal, which is used in a variety of industrial products, is now trading at a 6-month high (updated charts this morning)…
Anemic U.S. Growth
Another signal that the U.S. economy has stalled or is slowing down…sales and profits are falling at more of America’s biggest companies, according to the latest quarterly survey carried out by the National Association for Business Economics…the share of those reporting stronger sales has dropped to the lowest level in 7 years…and, for only the second time since the end of the Great Recession, more respondents said profits were falling than those who said profits were rising at their companies…the pace of hiring has slowed in the last three months…
All the monetary “stimulus” possible from the Fed would do far less to kick-start the American economy than a comprehensive package from Washington that dramatically reduces the Obama double burdens of over-regulation and excessive taxation that’s choking the U.S. business sector…such a change can only come in November when Americans go to the polls…
Citigroup today downgraded its outlook for the U.S. economy for 2016–2017, saying “the risks are very evident”…William Lee, head of North America economics at Citigroup, said in a research note: “Our outlook has little potential to be surprised on the upside, but the risks are very evident on the downside.” Recently revised and incoming data imply GDP will grow by only 0.9% in the 1st quarter and 1.7% for the year, the report noted, adding that inflation is projected to remain subdued…that’s not exactly an environment within which the Fed is about to increase interest rates…
Brazil’s Lower House Impeaches President
Brazil’s political crisis has deepened as a motion to impeach leftist President Dilma Rousseff overwhelmingly passed in the lower house last night and will now go to the upper house, the Senate, which is expected to suspend the President next month while it carries out a formal trial…the problem is, while Rousseff needs to be ousted, about 60% of the 594 members of Congress are facing corruption and other charges…this is a country in a severe economic, moral, social and political mess – and it’s hosting the summer Olympics…
Oil Update
The lack of “Doha deal” over the weekend among 16 global OPEC and non-OPEC producers is actually positive for the Oil market looking out over the final 6 months of this year…any artificial jump now in Oil prices would likely bring more Crude back onto the market and delay the critical supply/demand rebalancing process which needs to come to its natural conclusion…declining supply and improving demand should benefit Oil prices during the 2nd half of this year…
The collapse of talks also underscores the intense rivalry between Saudi Arabia and Iran, though it’s strange that the Saudis commented yesterday that they couldn’t support an output freeze at the moment because Iran wasn’t willing to participate…Iran made it clear beforehand that they would not even attend the talks, and they also stated that they were unwilling to freeze production as they seek to regain market share which was lost during years of economic sanctions…what was the meeting in Doha all about, then?…the Saudis obviously don’t want to do the Iranians any favors, which is understandable, and they’re also determined to inflict more pain if they can on North American producers…
Last week, ahead of the Doha talks and not trusting these Middle Eastern countries or the Russians who were also at the table, we closed out our HOU ETF position with a profit of 40% in less than 2 months…hedge funds and other money managers expanded their net-long position in U.S. Crude by 11% in the week ended Tuesday, according to the latest COT data…Crude prices could slip back to the mid-$30’s if investors start unwinding those bullish positions…
We continue to maintain a 100% accuracy rate on our ETF trades for subscribers with short-term gains of 60%, 35%, 47% and 40%…stay tuned for our next pick…there will likely be an opportunity to re-enter the HOU at a strategic time later this quarter…
In today’s Morning Musings…
1. Updates and new charts on Lithium plays on the move again this morning…
2. A must-own Gold explorer in Nevada gearing up for a huge drill program…
3. What’s in store this last half of April for the TSX Gold Index? – you may be surprised…
Plus more…to view the rest of today’s Morning Musings, login with your username and password, or click here to take advantage of our Spring Sizzler Subscription Special in effect for a limited time only…
SAVE 25% with a risk-free subscription as you gain full access to this and other exclusive BMR content and features, including our new Top Opportunities List May 1!…
Hello Jon, I already asked the question last month, and now again. Hope to have an answer when you have the time. I understand you are a busy man !
I am surprised that you are not mentioning ALiX Resource (AIX) in your Lithium plays. Any particular reason why? They have claims on both sides of BCN, and a deal with LIT (Australian company) which provides the technology for Lithium extraction. With the new acquisition last week in Ontario and Nevada, AIX projects now embrace the full spectrum of lithium plays: clay, hard rock and brine. Added geographic diversity and from the sound of the last NR they haven’t finished yet with their expansion.
With the share consolidation of a few years back, share structure seems adequate. It got out of its 6-month range-bound (4 cents – 6 cents) last week, reached 10 cents this morning and retreated at 8.5 cents.
What’s your take on AIX?
Thanks, and sorry for repeating myself here. 😉
Richard
Comment by rgiroux — April 18, 2016 @ 10:06 am
Hey guys. Keep an eye on FNC.v They staked some potential lithium properties in Quebec. Nothing has been announced via the news wire only announced in their latest MD&A so its pretty low key so far. Stock is moving lately with increased volume. Lots of other potential with this stock, but I think its the potential of LIthium that’s moving this right now.
Comment by tony t — April 18, 2016 @ 11:12 am
Hi Richard, my take on Alix is that it could do well and I hope it does well. The volume and price increase in recent days is certainly very encouraging. Compared to the other Lithium plays we’ve been following, I’d like to see AIX “tie it all together” in terms of making a more compelling case for the value proposition of its landholdings and strategy. You stated it very well, “With the new acquisition last week in Ontario and Nevada, AIX projects now embrace the full spectrum of Lithium plays: clay, hard rock and brine.” Speculators could do well here if management plays its cards right.
Comment by Jon - BMR — April 18, 2016 @ 2:53 pm
What do people figure on VGN? Are they just waiting for DVR to start trading again or do they have other things promising on the go that will move the stock price? I like the share structure there and they seem to have money which are key all the time.
Comment by Ed — April 18, 2016 @ 3:08 pm
Thanks for your answer Jon. I think you are right with your last sentence: “if management plays its cards right…”. I think the partnership with LIT is a great start. To be continued…
Comment by rgiroux — April 18, 2016 @ 3:22 pm
I hope that the dump of GGI is only a person tired of waiting and not an indication of non of bad news to follow.
Comment by charleybarley — April 18, 2016 @ 4:42 pm
When it comes to the market, CharleyBarley, it’s very true that the range of human emotions is always tested, and they tend to drive the market (fear, greed, impatience, etc.). Knowing that, you can often take advantage of others’ mistakes during peak levels of emotion. That’s why I added some GGI yesterday and took some profits off the table elsewhere.
Comment by Jon - BMR — April 19, 2016 @ 1:16 am
Silver finally makes the leap, as predicted, this morning (but that still required some faith and patience). More great charting from John as Silver takes off and gets set to challenge resistance at $17. It’s also leading Gold higher. Some Silver plays should certainly do well today.
Comment by Jon - BMR — April 19, 2016 @ 1:36 am
NEWS…Snipgold
Seabridge to acquire SnipGold at 29.1 cents per share
2016-04-19 07:07 ET – News Release
See News Release (C-SEA) Seabridge Gold Inc
Mr. Rudi Fronk of Seabridge reports
SEABRIDGE GOLD INC. TO ACQUIRE SNIPGOLD CORP. BY WAY OF PLAN OF ARRANGEMENT
Seabridge Gold Inc. and Snipgold Corp. have entered into a definitive agreement dated April 18, 2016, pursuant to which Seabridge has agreed to acquire all of the issued and outstanding common shares of SnipGold by way of a statutory plan of arrangement under the Business Corporations Act (British Columbia).
Rudi Fronk, Seabridge’s chief executive officer and chairman, said: “The board of directors of Seabridge believes the proposed transaction will enhance our exploration potential in an area where our technical team has built up significant expertise. This proposal also meets our transaction test of immediately increasing our gold resource ownership per share. Our KSM project has geological similarities to SnipGold’s Iskut project and the two properties are near enough to each other to offer synergies in terms of personnel and infrastructure.
“This business combination offers SnipGold shareholders the opportunity to maximize the potential value of their Iskut property by accessing the technical and financial resources needed to explore, engineer and permit their project. SnipGold shareholders will also benefit from Seabridge’s more senior exchange listings and greater liquidity. In our view, the proposal offers shareholders of the combined company the potential for enhanced capital appreciation with exposure to a larger asset base in B.C.’s prolific Golden Triangle.”
Patrick Soares, chairman of SnipGold, said: “SnipGold’s board of directors believes that our loyal shareholder base will benefit from this combination of companies. We are pleased by the premium that shareholders are receiving from Seabridge, which we think is in recognition of not only the exploration efforts of SnipGold management, but the underlying value of SnipGold’s property. Seabridge has the ability to fund the project going forward with minimal dilution to its shareholder base.”
John Zbeetnoff, president and chief executive officer of SnipGold, said: “I am pleased the SnipGold project will pass to a mid-tier company that has the funding capacity to build upon our technical efforts that advanced the understanding of the area. Our project offers Seabridge excellent high-grade gold and bulk-tonnage resource expansion and discovery potential at several drill-ready targets.
“I want to thank the employees and consultants of SnipGold for the loyalty and sacrifice they have shown the company during the last few difficult years. I also want to thank our shareholders and board of directors, for their support. As well, I thank the B.C. Ministry of Mines, the Ministry of Environment and the Tahltan First Nation for working collaboratively with SnipGold management through the years. Without the patience and faith entrusted in management by stakeholders, we would not have been able to advance the company to this stage.”
Comment by John - BMR — April 19, 2016 @ 4:01 am
Ok, a SnipGold takeover by Seabridge…more than an instant double…perhaps now people will get the message about what’s happening in this area. This is going to be phenomenal. Pro subscribers—refer again to our Sunday Sizzler Report because this is just the beginning for the companies mentioned in that report plus others that we’ll be putting forward soon…game changer and we called it first.
Comment by Jon - BMR — April 19, 2016 @ 4:49 am