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Gold is firmer this morning…as of 5:05 am Pacific, bullion is up $9 an ounce at $1,713…Silver is 15 cents higher at $33.26…Copper is at its highest price in almost two months, up 3 pennies to $3.65, as investors took heart from rising factory output growth and strong retail sales in China…Crude Oil has climbed 66 cents to $86.59 while the U.S. Dollar Index is off one-tenth of a point at 80.39…

Today’s Markets

Asian markets were slightly higher overnight with China’s Shanghai Composite leading the way by posting a 22-point gain to 2084…European shares are down modestly while stock index futures in New York are pointing toward a slightly negative open on Wall Street…the Venture Exchange begins the week at 1186, about 20 points above important support…

All Eyes On The Fed This Week

Expectations are that the Fed will announce new stimulus measures after its two-day meeting ends Wednesday, but how it goes about it – if it merely reshuffles its balance sheet or actually expands it – will determine the impact on the Gold market…for new stimulus to have a direct impact on bullion, it needs to be new outright purchases and that’s what some analysts are expecting with the Fed replacing the expiring “Operation Twist” with purchases of longer-term Treasurys funded by new money creation…the central bank is expected to reiterate its open-ended commitment to maintain this “quantitative easing” until it sees a substantial improvement in the labor market outlook…

China Trade Numbers Disappoint But Domestic Demand Still Strong

China’s trade numbers for November came in far below expectations, taking some shine off the encouraging industrial output and retail sales data released over the weekend…however, economists are confident the slump in export growth will not derail the recovery in the world’s second largest economy…the rise in exports, which make up 25% of the country’s gross domestic product (GDP), slowed to 2.9% year-on-year last month, against expectations for a 9% uptick, driven by weaker demand out of the U.S., Europe and Japan…import growth, meanwhile, was flat, below forecasts for a rise of 2%…”The trade numbers are disappointing coming off two months of strong data, but they don’t change the picture of accelerating GDP growth in China,” Darius Kowalczyk, senior economist at Credit Agricole-CIB, told CNBC…”China is not as export dependent as it used to be, what matters now for growth is domestic demand,” he added…

Italy In The Spotlight Again

Italy’s government borrowing costs jumped and its stock market fell sharply today after Mario Monti’s weekend decision to resign as Italy’s prime minister earlier than expected…the yield on 10-year Italian bonds rose 28 basis points to a two-week high above 4.8% after analysts warned financial markets to brace for a fresh outbreak of euro zone political turbulence…Monti has said he will step down when the country’s 2013 budget passes into law, which could be as early as this month, triggering an election in mid to late February, six weeks ahead of schedule…his hand was forced after former Prime Minister Silvio Berlusconi’s party withdrew its support for the technocratic government, while Berlusconi indicated he wanted to return to politics…Monti’s resignation announcement sent firmly into reverse the steady falls in official borrowing costs that Italy has enjoyed under Monti, whose year in office has seen a turnaround in investor confidence towards the country and its reform efforts…early last week, the country’s 10-year bonds were trading on yields below 4.4%, the lowest for two years…Italy faced increased costs in a bond auction planned for Thursday, analysts warned…

Japan Slips Into Recession

Japan slipped into a technical recession in the six months to September, strengthening opposition leader Shinzo Abe’s case for more fiscal stimulus and “unlimited” monetary easing to boost growth in the world’s third-largest economy…final gross domestic product data today showed that output slipped by 0.9% in the three months to September, in line with earlier estimates…however, the government revised down the previous quarter’s estimate to an annualized 0.1% contraction, matching the textbook definition of a technical recession…it would be Japan’s fifth in the past 15 years…

Updated Silver Charts

As usual, John has fresh Silver charts – short-term and long-term – to begin the new week…Silver continues to outperform Gold and that pattern is not expected to change…

Silver Short-Term Chart

RSI(14) is bouncing up from previous support and buying pressure as shown by the CMF remains strong…a decisive move back above the EMA-20 ($33.19) would be bullish…

Silver Long-Term Chart

Rainbow Resources (RBW, TSX-V) Chart Update

Rainbow Resources (RBW, TSX-V) took a hit Wednesday and Thursday on disappointing drill results from the International Property, but a recovery out of oversold conditions started Friday with the stock gaining 2 pennies to close at 15 cents as investors shifted focus to Jewel Ridge where RBW is enjoying some success…the company also got some good news from the Prospectors and Developers Association as a PDAC selection committee granted Rainbow a Core Shack display at the upcoming convention in March…today, we’re conducting an extensive interview with Rainbow President David W. Johnston, the first part of which we’ll be posting tomorrow, and besides some pointed questions on the International we’ll be trying to learn more about Rainbow’s efforts at Jewel Ridge as a “conceptual geological model” is currently being put together for the property…in the meantime, below is an updated RBW chart from John…note the “hammer reversal” last week and how the RSI(14) is rebounding from strong support…

Northern Gold Mining (NGM, TSX)

Northern Gold Mining (NGM, TSX) pulled back mildly as expected and is now regaining strength…what’s interesting about this chart from John, as we’ve pointed out before, is the very pronounced “cup with handle” pattern…NGM is advancing two gold deposits in Ontario…

Ryan Gold (RYG, TSX-V)

Yukon Gold stocks are out of favor at the moment which means there have to be some good bargains available…Ryan Gold (RYG, TSX-V) was sitting on over $30 million in cash at the end of September, and the stock is down about 70% for the year and trading at its lowest price in more than two years…RYG closed Friday at 21 cents, giving it a market cap of approximately $25 million…below is a 7-month daily chart from John…RYG is not ready for an instant turnaround but it’s certainly a good bottom fishing opportunity at this time of the year to consider for patient investors…as always, perform your own due diligence…

Note: John and Jon both hold share positions in RBW.