Gold has traded in a range between $1,663 and $1,671 so far today…as of 5:00 am Pacific, the yellow metal is down $3 an ounce at $1,663…Silver is off 27 cents at $30.63…Copper has lost 3 cents to $3.41…Crude Oil is 69 cents lower at $95.64 while the U.S. Dollar Index is up slightly at 81.44…
Gold Smuggling On The Rise In India
As Gold prices have hit the roof in India, an unprecedented increase in the smuggling of the precious metal is being witnessed…Indian authorities are seeing a spike in undeclared Gold being smuggled into the country…according to intelligence agencies, state Gold seizures at airports have risen almost 10-fold in recent months with the increase in the import duty on Gold, from 2% to 4%, announced by the then Finance Minister hailed as one of the main culprits…given the climbing price of the yellow metal (the rupee has declined considerably in value vs. the Dollar over the past year) and the delayed monsoon, bullion traders were expecting Gold imports to nosedive by 40% this year…the slump in imports is however being met through smuggling, spawning a revival in the trade, according to traders…data from the finance ministry shows that between April and June this year, the customs authorities have seized 200 cases of smuggled Gold worth $169 million, up 272% as compared to $46 million in the previous year from 20 registered cases…Gold smuggling was a thriving business in India in the 1980’s and 1990’s, during the Gold Control Act, but it reduced drastically after economic liberalization…
Today’s Markets
Asian markets were mixed overnight with China’s Shanghai Index taking another hit, falling 20 points to 2053…European shares are mildly lower today while stock index futures in New York as of 5:00 am Pacific are pointing toward a slightly negative to flat opening on Wall Street…economic data this morning includes another look at Q2 GDP (5:30 am Pacific) as well as pending home sales (7:00 am Pacific)…the biggest release of the day comes at 11:00 am Pacific when the Fed puts out its beige book on the economy, which is sure to be picked over for any discussion of employment…
All Eyes On The ECB & The Fed
The European Central Bank needs to employ “exceptional measures” at times to ensure its monetary policy can be effective but will act within its mandate to deliver price stability, ECB President Mario Draghi said in a newspaper opinion piece today…Draghi wrote in the piece for Germany weekly Die Zeit that fulfilling the price stability mandate “sometimes requires us to go beyond standard monetary policy tools”, when financial markets “are fragmented or influenced by irrational fears”…”We have to fix such blockages to ensure a single monetary policy and therefore price stability for all euro area citizens…this may at times require exceptional measures,” he wrote in the article, released in English by the ECB under the title: “The future of the euro: stability through change”…the ECB is working on the details of a new bond-buying plan aimed at tackling the euro zone crisis by lowering the crippling borrowing costs facing Spain and Italy…Draghi may detail the plan after the ECB’s Sept. 6 policy meeting (he has cancelled his trip to the Jackson Hole Fed meeting, raising hopes among some traders that he will make a major announcement next week)…however, next week’s ECB meeting comes ahead of some key political events in Europe including the proposal for an EU-wide bank supervisor from the European Commission, the German constitutional court ruling on the European Stability Mechanism, a Eurogroup meeting, and a much-awaited troika report on Greece by October…there’s speculation, therefore, that the ECB’s real commitments could be postponed until October to ensure more progress on crisis resolution from governments…
Meanwhile, market participants are also chewing over the prospects of additional easing steps by the Federal Reserve ahead of an important speech Friday by Fed Chairman Ben Bernanke at the central bank’s annual economic symposium in Jackson Hole, Wyoming…this follows disappointing U.S. consumer confidence data yesterday…consumer confidence in August fell short of expectations, dropping to the lowest reading since 2011, according to the Conference Board…so far this year, Bernanke has been more talk than action, so we’re expecting more of the same from him Friday (little or no fresh insight) which means the standard hint that the Fed will step up to the plate with new easing measures if and when necessary but nothing definitive at the moment…the U.S. equity market is also currently near four-year highs and the Fed traditionally acts only when the market begins to teeter…Bernanke may wish to keep his powder dry until later in the year – perhaps even as late as December – following the U.S. elections when the direction of fiscal policy will likely become more clear…
Venture Exchange
The CDNX fell for the second straight day yesterday, losing 5 points to close at 1242 – 2 points above the rising 10-day moving average (SMA) while the 20-day is sitting at 1215…the 50-day has flattened out at 1200 and potentially could begin to reverse to the upside by as early as sometime next week…so there is plenty of support in this market and investors just need to be patient in terms of a breakout through the 1250 resistance that John has outlined…below is an updated Venture chart showing that any weakness should be minor and short-lived as the primary trend at the moment remains bullish…
Rainbow Resources (RBW, TSX-V)
Yesterday was a strange session for Rainbow Resources (RBW, TSX-V) which got knocked down on small orders during the final two hours hours of trading…in fact, the stock fell from 22 cents to a Venture close of 20 cents (it closed at 22 on ALPHA and in the U.S. market) on less than 10,000 shares in the final 3 minutes…this could have had something to do with month-end settlement, which was yesterday, or just some traders who decided the stock needed to test its rising 50 and 200-day moving averages at 19.5 cents which it did…in any event, it was bargain day yesterday as the overall chart remains bullish…we’re expecting a powerful September based on the strong technicals and events on the ground as the drill continues to turn…below is an updated RBW chart from John that puts yesterday’s shenanigans into perspective…a drill hole hit at the International, which we believe is a very strong possibility given positive indications so far about the obvious high-grade structure they’re drilling into, will send RBW north through its 52-week high in a heartbeat…
Note: John and Jon both hold share positions in RBW (Terry does not) with Jon adding to his position again yesterday.
Great Atlantic Resources (RBW, TSX-V)
Volume has been picking up recently in Great Atlantic Resources (GR, TSX-V), a play we’ve been keeping a relatively close eye on since early this year (our last update was just two days ago)…GR has a solid property portfolio in Atlantic Canada and strong management and leadership with Chris Anderson at the helm as President and CEO, so this is definitely a company we encourage our readers to become familiar with…
Note: John, Jon and Terry do not hold share positions in GR.
RBW will recover from yesterday’s unknown loss… GQC… my sell lot is placed at $1.69
Comment by Theodore — August 29, 2012 @ 4:46 am
The Dave poster yesterday must be a new Dave. I am the old Dave. The one that said 2 weeks ago RBW could trade under .20 again before a new uptrend. As for support, it did break support at .24, and closed at a stronger support level.
I must say I loved this confirmed breakout and the fact we could be chasing it in the 30’s by week end.
Comment by dave — August 29, 2012 @ 5:04 am
A NR on a friday afternoon what a bunch of freakin rookies what the hell are they smokin they couldnt wait for Monday morning,releasing news on friday cmon management screw up one more to the list.
Comment by Gerry — August 29, 2012 @ 5:30 am
me theo current gqc holdings = the bag
Comment by sean — August 29, 2012 @ 6:10 am
Most have a fetish with RBW, I hope its getting satisfied
Comment by john — August 29, 2012 @ 6:21 am
GQC… dumping continues after profit taking and it is a healthy adjustment… My loss position is at 64 cents… but I do not think the stock can go below $1.30… Certainly, some rebound will be seen today… perhaps, back to $1.50
Comment by Theodore — August 29, 2012 @ 6:31 am
GQC needs to fill that gap at 1.00
Comment by john — August 29, 2012 @ 6:39 am
that makes sense sean ???????
Comment by wes — August 29, 2012 @ 7:21 am
Jon @ BMR – seeing some decent volume on the ventures today for a change – well above average. This said though, we are going the wrong direction of course. Wanted to get your thoughts on how this could possibly tie into any sort of a breakout above the 1250 mark you’ve alluded to a few times as of late.
I’m not technical guy, but it seems like the trend on the ventures is about to reverse and head south. IT usually has when we drop a percent or more on high volume in the past. I think “investors,” if we want to call ventures traders that, are willing to take quick profits from the mini-run we’ve had on the CDNX during the past month.
Or this could all be accumulation for more to come.
Comments?
Comment by alex — August 29, 2012 @ 8:34 am
Oh Gerry, did you seriously think that it would’ve made any difference at all whether they released it on Monday as opposed to Friday afternoon? It is obvious (and we’ve all been talking about it) that there is heavy HEAVY resistance at the 24cents range. If the news piece had been something that the market was hungry for, the SP would’ve shot up on Monday morning especially with the weekend giving the buyers a time to gestate. BUT it didn’t. Therefore, the news was not what they were hungry for, and thus it would’ve made no difference when the news was released.
What the market idiots want is easy money with no patience involved. They’re like spoiled children wanting a quick satisfying good-looking news release, then WHAM BAM THANKYOU MA’AM, they’ll be gone just like that. We here at are a different breed. We’re a finer breed. Yes we like the quick ones too, but that’s not all that we can appreciate. Slow and steady can win the race too.
Comment by Muiyan — August 29, 2012 @ 9:55 am
Personally, I believe the Venture is behaving exactly according to script at this point….resistance at 1250, with clear support levels at 1200 and above as indicated….a new uptrend is underway (the 20-day SMA is important to track as it continues to rise) but patience is required in the early stages of an advance like this…..volumes have been picking up, there’s more interest, and various indicators have definitely turned bullish….remember, sellers’ exhaustion crept in and the market built up a huge support zone below 1200……I think everything looks very good as John’s chart showed this morning – don’t get fooled at this point by an expected minor pullback…..it’s not going to be up every single day……
Comment by Jon - BMR — August 29, 2012 @ 10:10 am
What about the S&P way above its 50 day MA- Heavy insider buying into this rally which started in June I believe- Sept. & Oct. just around the corner- Tax-loss selling over ?- People like Marc Faber looking for a 20% correction on the Dow then QE 3-
Comment by Richard — August 29, 2012 @ 2:09 pm
RBW marginally recovered to close at 23 cents in low volume. GQC will have some strong rebound if it hits $1.40 I might have to adjust my price in sell lot. The outlook in this one will be $1.40 – $1.50 range. If daily volume is dropping to $1 – 2 million shares, it may go down to $1.20 – $1.30.
Comment by Theodore — August 29, 2012 @ 2:20 pm
Still waiting for your comment on interview with Andre. Do you feel hoodwinked
Comment by john — August 29, 2012 @ 3:56 pm
Sorry, I missed your question earlier….what do you mean?
Comment by Jon - BMR — August 30, 2012 @ 2:23 am
Jon, do you ever sleep? You are on Vancouver time?
Comment by Alexandre — August 30, 2012 @ 3:50 am
Yes, I’m in Burnaby (just outside Vancouver)….usually up at 2:30 am with the birds….
Comment by Jon - BMR — August 30, 2012 @ 3:52 am
Jon, as for me, i live in the Indian Himalayas. Presently in Montreal visiting my elderly mother.
Comment by Alexandre — August 30, 2012 @ 3:56 am
Wow, that’s interesting…I know what it’s like in Montreal (I have an apartment there) but what’s it like in the Indian Himalyas?
Comment by BMR — August 30, 2012 @ 3:58 am
I have been there for 18 years, since resigning from the Canadian Air Force. It is in the Kullu valley. It is green with orchards and narrow terraces. The white peaks. are behind.
Comment by Alexandre — August 30, 2012 @ 4:07 am
Thanks for the reply,
What I meant was when you conducted the interview, Andre had mentioned that there may be a 500K or so small offering to keep some cash on hand. Also that there would be a JV partner to further drilling on APV, now since Andre mentioned that he needed about 2 mil to continue in the near future he has just done that now without a JV partner, issued stock for 1.5 million and could tap Focus stock in NOV for about 600 K.. NOW a JV partner should NOT be in the cards since this 2 or so million is on the books or will be. Remember, Andre just got rid of a JV partner in Brigus, why would he want another ?
Also I wish you would have asked about that old Kattaskama deal that went sour, it was a 7 Million sale of Canadian property with a M&I of upwards of 800K oz. What is happening with this, this would provide another 2 million in cash and rest in stock of the future buyer if there is even one now. ?
Comment by john — August 30, 2012 @ 4:22 am