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Gold is experiencing more weakness today after being rocked yesterday by the sharp drop in crude oil prices following the surprise move by major countries to release a small portion of their strategic oil reserves onto the world market…as of 8:00 am Pacific, the yellow metal is off $13 an ounce at $1,508…Silver has declined 57 cents to $34.74, crude oil is flat at $91.07 while the U.S. Dollar Index is one-third of a point higher at 75.64…yesterday’s developments in the oil market, with the International Energy Agency and the U.S. Department of Energy deciding to release 60 million barrels of reserves, are a clear reminder how regulators or governments can create downside risks in markets…the move had to have come at the blessing of Saudi Arabia which tried to push through a production increase at the OPEC meeting earlier this month but was thwarted with stiff opposition from Iran, Venezuela and Algeria…oil is now at a price level that should help, not hinder, global economic growth though governments cannot forever manipulate prices…over the long haul, significantly higher oil prices seem inevitable given the demand-supply dynamic…Gold miners’ profit margins will be aided by lower crude prices as the price of oil is a big component of their cost structure…Gold itself has solid support at $1,500 and the long-term uptrend remains completely intact…expect aggressive physical buying to step in on any move below $1,500 if that should occur…the CDNX has held up well in the face of weakness in Gold (and the broader markets) which is an encouraging sign…the CDNX is currently off a point at 1915…the Index dropped as low as 1894 intra-day yesterday but regained half its losses by the close…some continued consolidation in the CDNX should be expected but the “big picture” outlook remains very positive and we continue to anticipate a strong second half of the year…below is John’s CDNX chart update, showing more consolidation over the immediate term is likely…

Seafield Resources (SFF, TSX-V) has been a strong performer recently, climbing above its declining 100-day moving average (SMA) yesterday for the first time since early March…there is major technical resistance in the mid-30’s, however (the February and March highs plus the 200-day SMA) so jumping on the SFF bandwagon at this point is probably a little premature…however, at some point during the second half of the year we expect Seafield to bust out strongly given the exploration upside of its Quinchia Project in Colombia…SFF released its first quarter financials this morning, showing $18 million in cash as of March 31…subsequently the company also completed a $3 million financing with a strategic investor at 30 cents…Seafield is currently off a penny-and-a-half at 31.5 cents…the more we look at Adventure Gold (AGE, TSX-V) the more excited we get which is why we’ve made arrangements for an interview, likely next week, with President and CEO Marco Gagnon…Adventure Gold, which we first introduced to our readers about nine months ago when it was trading in the low 20’s, is an extremely focused exploration company with a strong technical team and several advanced projects that are proceeding extremely well…Windermere Capital, a Montreal-based investment firm, is a strategic and valuable long-term partner for Adventure Gold and holds just under 20% of AGE as reported January 21…AGE has significantly outperformed the CDNX this year and we see no reason why that trend won’t continue through the balance of the year…AGE is currently off 2 pennies at 56 cents…Romios Gold (RG, TSX-V) is an interesting exploration play in the Galore Creek area of northwestern British Columbia that we’ve been mentioning recently…yesterday, RG jumped 7 cents to 50 cents after announcing preliminary results from a 743-kilometre airborne geophysical survey over the company’s wholly owned Dirk and Andrei properties…we suggest readers perform their DD on Romios – the company has launched a $6 million+ exploration and drilling program over very prospective ground…technically, it’s possible the stock could pull back slightly from current levels as what John sees at the moment is the formation of a minor “cup with handle”…we’ll be posting a full chart on RG over the weekend…Currie Rose Resources (CUI, TSX-V) is unchanged at 16 cents this morning…the company’s 10,000 metre drill program in Tanzania is expected to begin almost any day now…CUI has formed a strong base at current levels and its 100-day SMA has flattened out….with excellent geological prospects and its most aggressive exploration program ever, we’re expecting a major breakout in CUI over the summer…on the economic front, U.S. durable goods rose 1.9% in May, more than expected, while Chinese premier Wen Jiabao has declared victory over domestic inflation, saying that the government has successfully reined in price pressures…the Shanghai Index was up strongly overnight, gaining more than 2% to close at 2746…“China has made capping price rises the priority of macro-economic regulation and introduced a host of targeted policies…these have worked,” Wen wrote in Friday’s Financial Times…”we are confident price rises will be firmly under control this year”…consumer price inflation in China has been rising since the middle of last year, reaching a 34-month high of 5.5 per cent in May…politically sensitive food prices have been the main driver of headline inflation, rising more than 10 per cent year-on-year in each of the past five months…food inflation hit 11.7 per cent in May, feeding fears that persistent price rises could exacerbate social tensions…most analysts predict that the headline inflation rate will peak soon, before starting to decline…according to an HSBC purchasing manager’s index, inflationary pressures have eased in the manufacturing sector…“The overall price level now is within a controllable range and is expected to drop steadily,” Wen stated…any easing of Chinese monetary policy over the second half of the year, combined with a slight to moderate pick-up in economic growth, would likely have positive implications for global equity markets…