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Weighing on Gold last week was a drop in holdings of physically-backed exchange traded funds to 55.231 million ounces from 55.654 million ounces when the Fed raised rates and pushed the Dollar Index to 2-week highs…however, the greenback’s rebound is merely a dead cat bounce given a deteriorating technical picture…very strong resistance begins at 98 on the Dollar Index…Gold, meanwhile, could drop a little more but support is powerful in the $1,230’s…

A number of Federal Reserve officials this week will give their first public comments following the central bank’s decision to raise interest rates last Wednesday, and that began this morning with William Dudley who addressed business and community leaders in Plattsburg, New York…

Dudley aligned himself with Chair Janet Yellen in declaring his expectation that a tight labor market will eventually trigger a rebound in inflation data that has been unexpectedly weak in recent months.  “We’re pretty close to what we think is full employment.  Inflation is a little bit lower than what we would like, but we think if the labor market continues to tighten, wages will gradually pick up, and with that, we’ll see inflation get back to 2%.”

Of course, we’ve been hearing that same tune from the Fed on inflation for how many years now?…

Dudley also sounded a positive note on the U.S. economy overall, while saying the central bank wanted to tighten monetary policy “very judiciously” to avoid derailing the expansion that began in mid-2009…

Traders have raised their outlook on a rate hike by the Fed’s Dec. 12–13 policy meeting to 45% from 41% late on Friday, CME Group’s FedWatch tool showed…

Taking On Tesla

The electric car market continues to heat up with new entrants looking to take on the likes of Tesla and traditional automakers in the space…Chinese start-up CHJ Automotive is the latest player looking to come to market…the company is currently developing 2 vehicles – an “ultra-compact” electric car, and a hybrid SUV…co-Founder Kevin Shen did not reveal the names of the vehicles, hoping to keep them a surprise until later, but did reveal to CNBC that the company is aiming for a launch in March 2018 for the compact car…

$200 Million Cobalt Deal

Cobalt 27 Capital Corp. (KBLT, TSX-V) has priced its public offering of 22.2 million post-consolidated common shares at a price of $9 per share…the $200 million offering will consist of 10.9 million shares being sold for gross cash proceeds of $98,319,780, and 11.3 million shares being issued to acquire 1,205.6 tonnes of physical Cobalt for a total cost of $101,680,245…both the offering and the purchase of physical Cobalt under the Cobalt contracts are expected to close concurrently on or about June 23…the Venture Exchange has conditionally approved the listing of the shares being sold under the offering…

eCobalt (ECS, TSX) is trading at highs not seen since early April this morning while the still undervalued and top northern Ontario Cobalt play, Castle Silver Resources (CSR, TSX-V), has just raised another $1.2 million and is only a nickel shy of its multi-year high reached in mid-April…underground sampling continues at the Castle mine (1.8% Cobalt and 8.6% Nickel highlighted initial assays) while drilling starts shortly…CSR could soar on strong results from quartz-carbonate veins containing high-grade Cobalt and Nickel that were left untouched by previous operator Agnico Eagle (AEM, TSX) which focused on mining exceptionally high-grade Silver…

Venture Short-Term Chart

Last week, the Venture’s RSI(2) plunged to levels not seen since the bear market bottom in January 2016…we’ll see in the coming days if a reversal starts to gain traction, though it’s possible the Index may have to briefly push below its rising 300-day moving average (SMA) around 770 as it has done in every bull market going back the last 15 years…

The EMA(8) and EMA(20) are effective indicators for monitoring Venture short-term swings and reversals…note the short-term downtrend line from the April high of 838…a move above 800 would conquer the downtrend line…

Crude Oil Update

Oil prices are a little soft again today after a 4-week slide due to rising production in the United States, Libya and Nigeria…signs of faltering demand have also prompted weakening sentiment, dropping prices to levels not seen since before OPEC’s output cuts were first announced late last year…

Data on Friday showed a record 22nd consecutive week of increases in the number of U.S. Oil rigs, bringing the count to 747, the most since April 2015…Goldman Sachs said if the rig count holds, U.S. Oil production would increase by 770,000 bpd between the 4th quarter of last year and the same quarter this year in the Permian, Eagle Ford, Bakken and Niobrara shale Oilfields…

In today’s Morning Musings…

1. Cannabix Technologies (BLO, CSE) update…

2. iCo Therapeutics comes to life…

3. Daniel’s Den – how investors can profit from North America’s 4th largest Copper deposit…