BullMarketRun.com

Gold is under pressure again today, falling below $1,350 though it’s still within the $1,320 to $1,350 support band…today’s close will be interesting – we’ll see if bargain hunters jump in and provide a late-day reversal…as of 7:15 am Pacific, bullion is off $35 an ounce at $1,331…Silver is 97 cents lower at $22.25 – no surprise that it’s testing the $22 level where there is strong support…Copper is off a nickel at $3.19…Crude Oil is bucking the commodity trend today, up 72 cents to $108.26 while the U.S. Dollar Index is flat around 81.50…

While Gold’s recent move into the $1,430’s surprised Goldman Sachs as bullion went above their $1,300 an ounce forecast, the firm said yesterday it expects that Gold prices “will decline into 2014 on the back of an acceleration in U.S. activity and a less accommodative monetary policy stance.”

Goldman said Gold prices are already shedding the risk premium added on concerns of a military strike in Syria, particularly as a diplomatic solution to the problem may be in reach according to some pundits (who, we might add, are likely engaging in wishful thinking)…

For the September FMOC meeting slated for next Tuesday and Wednesday, Goldman said its economists expect a tapering of the Fed’s quantitative easing program…“This could prove the catalyst to push Gold prices lower although the looming debt ceiling may initially limit the downside to Gold prices until it is raised by the end of October,” they said…

There’s a belief in some quarters that the prospect of Fed tapering – an initial reduction of at least $10 billion a month in the bond-buying program – has already been baked into Gold prices, and bullion may go up next week no matter what the Fed decides to do…keep in mind that U.S. job growth continues to be lackluster and the jobless claims report this morning was more of a glitch than a sign of an improving U.S. labor market…

China’s Gold Appetite Continues

Even as the rather economically incompetent Indian government is seeking to further restrict Gold imports and is coming down hard on Gold loan companies across the country, China could well be on its way to import 1,000 tonnes of Gold for the whole year if recent buying trends continue…China imported 129 tonnes of physical Gold from Hong Kong in July, up from the 113 tonnes it imported in June, according to the Hong Kong Census and Statistics Department…this is the 2nd highest import level on record in a month and a year-over-year increase from 76 tonnes in July 2012…the July imports are also over and above the 518 tonnes of Gold imports the nation already brought in through the first 6 months of 2013, according to available data…

The largest Gold ETF in the U.S. holds just over 900 tonnes of physical Gold, and China has imported over two-thirds of that amount in just 7 months…

Overall Gold Demand Figures From Thomas Reuters GFMS

Thomas Reuters GFMS predicts that global Gold demand will fall during the 2nd half of the year as bar buying slips from a record and central banks add less to reserves…total demand will slide to 2,237 metric tons this half from 2,309 tons a year earlier and 2,533 tons in the first 6 months of 2013, the London-based researcher said today in a report…jewelry demand that reached a 6-year high in the 1st half on record buying in China will ease in the 6  months through December, it said…“Although an improving outlook for the U.S. economy has raised the probability that the Fed will start to scale back its stimuli after its September meeting, the majority of the negative factors have already been priced in,” GFMS said. “Demand in India is forecast to be some way short of the elevated level in the second quarter. Turning to China, the prospect for local demand is more promising, but growth is expected to cool down.”

Today’s Markets

Asian stocks were mixed overnight…Japan’s Nikkei average was down slightly but China’s Shanghai Composite gained 14 points to close at 2256…

European shares finished mostly flat today, recovering from earlier losses after the release of some weaker than expected economic data…industrial production data for July showed a 1.5% drop on a monthly basis, worse than the 0.1% expected…

The Dow is up 5 points as of 7:15 am Pacific…the number of new applications for U.S. jobless benefits fell below 300,000 for the first time since 2006, but the government attributed the surprising plunge to computer-related delays instead of a sudden improvement in the labor market…initial claims sank by 31,000 to 292,000 in the week ended Sept. 7, marking the lowest level since April 2006…yet a Labor Department official said 2 states made changes to their computer systems that resulted in some claims not being processed in time…the Labor Day holiday may have also skewed the report…as a result, initial claims are likely to rise in the following week and probably move closer to their prior range of around 325,000…economists surveyed by MarketWatch had expected claims to rise to 330,000 on a seasonally adjusted basis from an unrevised 323,000 in the last week of August…meanwhile, in other U.S. economic news, lenders initiated foreclosure action in August against the fewest U.S. homes for any month in nearly 8 years…

The TSX, hurt by weakness in commodities today, is off 84 points through the first 45 minutes of trading…the Venture is holding up quite well, considering the sell-off in Gold, as it’s currently down just 4 points at 940…

Fission Uranium Corp. (FCU, TSX-V) Update

More positive results this morning out of the Patterson Lake South uranium discovery from Fission Uranium (FCU, TSX-V) and JV partner Alpha Minerals (AMW, TSX-V) which of course FCU will be taking over in a friendly deal, subject of course to shareholder approval of both companies…notably, the R780E high-grade zone continues to develop as shown in results from PLS13-082, located 15 m east and 10 m north of hole PLS13-080 (13.41 m of total composite “off-scale” – greater than 9999 cps)…multiple zones of mineralization were intersected within a 120 m section between 118.5 m and 238.5 m, ranging in width from 1.0 m to 35 m…the main interval of mineralization is over a width of 35 m (146.5 m – 181.5 m) which is characterized by variably weak to strong radioactivity throughout, with occasional narrow intervals…a total composite of 4.7 m of “off-scale” (greater than 9999 cps) radioactivity is present in several discrete intervals ranging in width from 0.2 to 3.0 m…

Also released this morning were results from PLS13-089, collared 15 m west of PLS13-082…multiple zones of generally weak to moderately radioactive mineralization were intersected in hole #89, ranging in widths from 0.5 m to 16.5 m, within a 126.5 m section between 97.5 m and 224 m…

Two things are very interesting about John’s updated 6-month daily FCU chart below…RSI(14) is bouncing off previous support, and the rising 50-day SMA continues to provide strong support…PLS is a major discovery and a potential future buy-out of Fission could come at a significantly higher price…as of 7:15 am Pacific, FCU is off 2 pennies at $1.14…

Dolly Varden Silver Corp. (DV, TSX-V)

Dolly Varden Silver (DV, TSX-V) gained a penny-and-a-half yesterday on encouraging initial results from its summer drill program, but volume was only very modest at 137,000 shares (the best volume though since August 26)…results for 10 additional holes are expected in the coming weeks…this is an attractive long-term story as Dolly Varden’s property hosts 4 historical deposits (2 that were mined) in stratigraphy that is similar to Eskay Creek…the company is currently focused on the expansion of historical resource estimates with the goal to ultimately re-start production in the Dolly Varden camp, and to explore a major untested Eskay Creek type precious metal rich target located on the property…this summer’s drilling is giving the company a better understanding of the overall system as distinct mineralization phases have been identified, including a late phase which introduces native Silver at Torbrit…as President and CEO Ron Nichols commented in yesterday’s news release, this fact represents an important breakthrough in understanding the formation, structure, and distribution of the highest-grade mineralization and will be extremely valuable in targeting future exploration…

Below is an updated DV chart from John, a 1-year weekly…resistance is at 20 cents while strong Fib. support exists between 14 and 16 cents (16 cents is also where the rising 100-day SMA currently sits)…through the first 45 minutes of trading, DV is up half a penny at 19 cents…as always, perform your own due diligence, and keep in mind that DV will certainly be impacted by Silver’s ultimate direction – up or down…

Eagle Hill Exploration Corp. (EAG, TSX-V)

Eagle Hill Exploration (EAG, TSX-V) showed some strength yesterday, closing 2 cents higher at 13 cents after hitting an intra-day high of 15 cents…the company continues to advance its now 100%-owned Windfall Lake Property in northwestern Quebec…John’s updated 6-month daily chart shows strong very support around 10 cents (it touched a low of 11 cents Tuesday) and important Fib. resistance at 14 cents…the trend is clearly bullish, so any near-term weakness presents an opportunity, in our view, with the possibility of an eventual breakout above the 14-cent resistance area…EAG is down half a penny at 12.5 cents as of 7:15 am Pacific…

Pine Cliff Energy Ltd. (PNE, TSX-V)

An energy stock we’ve been keep an eye on in recent months is Pine Cliff Energy (PNE, TSX-V) which has shown impressive growth since the beginning of last year…PNE has no bank debt and its production levels have risen to approximately 6,850 barrels of oil equivalent per day, weighted approximately 97% toward natural gas…technically, the stock is looking strong with an all-time high close yesterday of $1.20…what appears to be developing is a breakout above an ascending triangle but this requires confirmation as per John’s 6-month daily chart…PNE is down 2 cents at $1.18 as of 7:15 am Pacific…as always, perform your own due diligence…

Note: John, Terry and Jon do not hold share positions in FCU, DV, EAG or PNE.