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Gold is stronger today but the yellow metal is nonetheless poised to post its first monthly loss since May…this is not totally surprising, given the fact Gold had clearly become technically overbought in September (a condition that has now been completely cleansed)…in addition, October historically is one of the worst months of the year for bullion…November, however, has been the best month for Gold prices over the last decade, so there’s good reason to believe that $1,700 will hold as the low for the final quarter of the year…

Data tracked by Bloomberg show that holdings in Gold ETP’s (Exchange Traded Products) rose to 2,587.92 metric tons yesterday, a new record…

As of 5:35 am Pacific, the yellow metal is up $11 an ounce at $1,720…Silver is up sharply, 52 cents to $32.27…Copper has gained 3 pennies at $3.53…Crude Oil  is up 61 cents to $86.29 while the U.S. Dollar Index is weak again today, down another one-fifth of a point to 79.78…the Dollar Index could not get through important resistance the other day, embolding the bears which is good news for Gold (and the Venture Exchange)…

Today’s most important chart is Copper, and the reason we’re excited is that it has hit extreme oversold levels based on RSI(2) not seen since the May-June period…this means we have good reason to expect a rebound in November and, indeed, Copper is starting to firm up today…it appears support will hold at $3.50 and another test of resistance around $3.80 appears to be in the cards based on this 2.5-year weekly chart from John…this is bullish for the Venture Exchange that typically performs best when Copper is in an uptrend…

Gold Views

Tom Kendall, head of precious metals research at Credit Suisse, in a report Tuesday according to CNBC:  “$1,800 remains a formidable barrier on the upside…a break through that level will likely require a combination of improved demand from Indian and/or Asian physical dealers plus renewed Fed purchases of Treasuries outright once Operation Twist expires at the end of the year…with the end of the festival season (traditionally marked by the end of Diwali, or the ‘festival of lights’) just over two weeks away, we can say with some confidence that this year will be one of the weakest for Indian gold imports in the past seven years”…

Robin Bhar, head of metals research at Societe Generale:  “The balance of interest may be shifting in the short term, away from professional investors who have been active in Q3 (and helping to drive the price higher), while their retreat, and associated price fall, is now starting to entice fresh physical interest…outside India and China, and elsewhere in Asia, physical demand remains keenly attuned to price movements, but there are signs now of some bargain hunting on any approach to $1,700″…

Germany To Check On Gold Reserves

Growing demands from German officials and politicians to formally check German Gold reserves now held in the United States have sparked media reports that the Gold reserves of several Western nations are believed to be smaller than previously thought…in an article published yesterday in Coin Week, Louis Golino suggests, “If these reports are accurate, they have important implications for the future price of Gold, and therefore for precious metals investors…first, they suggest that much less mined Gold exists than previously believed…second, this is especially significant to the so-called manipulation thesis, which hold that governments act to surpress the price of Gold,” Golino noted…”if governments hold less Gold than we thought they did, then their ability to affect the price will also be greatly diminished,” he advised…

Germany is believed to have 3,396 tons of Gold reserves, the second-largest Gold reserves in the world after the United States…German politicians, as well as Germany’s federal Court of Auditors, requested recently that the Bundesbank, Germany’s equivalent of the Federal Reserve, check up on Germany’s Gold reserves, the majority of which are in storage in offshore banks…Der Spiegel now reports that the Bundesbank has agreed to check up on the reserves…the Bundesbank will make arrangements to repatriate some of the country’s Gold reserves and test the Gold for purity…the Bundesbank has reportedly agreed to ship 150 tons of Gold currently stored at the New York Federal Reserves to Germany over a three-year period…German newspaper Bild reports 50 tons of Gold per year will be returned to Germany, where it will be melted down entirely to test the overall purity before being re-cast into standard Gold bars…

TSX Gold Index

The TSX Gold Index continues to look strong…what was important recently was when it held support around the 330 level despite the fact Gold itself fell through a support level at $1,730…below is an updated and bullish 6-month daily Gold Index chart from John…

Today’s Markets

Asian markets were mostly higher overnight as investors regained risk appetite despite absence of a fresh lead by Wall Street…European shares are also mostly higher after earnings reports showed positive results from European airlines and oil and gas firms…stock index futures in New York as of 5:35 am Pacific are pointing toward a positive open on Wall Street after the first two-day weather-related shutdown since 1888…estimates of the cost of Superstorm Sandy to the U.S. economy vary between $10 billion and $50 billion…the storm has killed at least 50 people, according to the Associated Press, and left millions of homes without power…New York City and New Jersey have suffered extensive flooding damage…

The Venture Exchange continues to show strong support as it gained 12 points yesterday and closed at its high of the day at 1303…we do believe a breakout above its downsloping channel in place since early 2011 will occur in November as outlined yesterday…

Corvus Gold (KOR, TSX)

The chart for Coruvs Gold (KOR, TSX), one of our favorites this year, has been a picture of beauty but the stock is now very close to the top of its trading channel where it is likely to meet stiff resistance…near-term, therefore, the risk of a pullback is quite high…Coruvs has been working on a financing (up to 3.25 million shares at $1.07) since the middle of the month, and they should have no problem closing that given the current stock price…

Newstrike Capital (NES, TSX-V) Chart Update

Newstrike Capital Inc. (NES, TSX-V) is looking solid on the charts right now as the company continues to make progress on the ground at its 100% owned Ana Paula Project in Mexico’s Guerrero Gold Belt…

Impact Silver (IPT, TSX-V)

As BMR readers know, we’re very bullish on the price of Silver and one of the beneficiaries of any major move in Silver over the coming months will be Impact Silver (IPT, TSX-V) which has three operating mines in Mexico as well a couple of others coming on stream…the stock has shown excellent support around the $1 level since late 2010, and closed yesterday up 19 cents at $1.43 where there is resistance at the 50-day SMA…any slight or mild pullback, however, should be considered an attractive entry point based on John’s chart below and the big picture outlook for Silver…as always, perform your own due diligence…

Note: John, Jon and Terry do not hold positions in KOR or NES or IPT…