Gold has traded between $1,225 and $1,246 so far today…as of 7:30 am Pacific, bullion is near its low of the day, down $11 an ounce at $1,227…Silver is off 46 cents at $19.72…Copper is flat at $3.33…Crude Oil is 17 cents higher at $93.62 while the U.S. Dollar Index is up one-quarter of a point at 80.89…
Gold is getting a push to begin the year from index rebalancing (the Goldman Sachs Commodity Index and the Dow Jones/AIG Commodity Index, for example, both raised their weightings for Gold and Silver for 2014 which has required these long-only funds to step in and buy)…
The big near-term test for Gold will be if it can overcome resistance around $1,275, as John’s chart showed Sunday, and then push above a downsloping wedge which would mean a strong move on impressive volume through $1,300…
Gold stocks, as measured by the TSX Gold Index, are beginning to look stronger but they still have important downward sloping trend lines to test from beneath…
Federal policymakers Eric Rosengren and John Williams will speak on the U.S. economy this afternoon…both are viewed as dovish regarding monetary easing and their speeches will be listened to with an ear to the December Fed policy meeting minutes due tomorrow…
Federal Reserve speakers continue to move the markets…yesterday, the Dow lost about 50 points as the Philadelphia Fed’s Charles Plosser, a hawk and a voting member of the FOMC, gave a speech in which he noted that the Fed must be prepared for a rapid tightening campaign, if needed…a little later in the day, the Dow rose modestly as Chairman Ben Bernanke, in his last major speech, said, “The combination of financial healing, greater balance in the housing market, less fiscal restraint, and, of course, continued monetary policy accomodation bodes well for U.S. economic growth in coming quarters.”
Janet Yellen’s confirmation as the next Chairman of the Federal Reserve was approved by the U.S. Senate last night…Yellen will become the first woman to lead the central bank in its 100-year history after the Senate voted to confirm her in a 56-26 vote…11 Republicans joined 45 Democrats to support her…no Democrats opposed her…
“With growth (in 2014) to the mid-3’s and potentially higher, you’re actually adding accommodation to the economy,” Joe LaVorgna, chief U.S. economist at Deutsche Bank, told CNBC yesterday. “Yes, you’re slowing the pace of the buying, but the balance sheet is still growing. It’s staggering to me. I just don’t see how they’re going to get out in a clean way.”
CRB Index Updated Chart
While the Venture has encouragingly overcome its downtrend line, the CRB Index has yet to do so…it’s currently constrained by the upper limits of the downsloping wedge (high 280’s) with strong support around 268…it closed yesterday at 277…
Asia
Asian markets were mixed overnight…China’s Shanghai Composite added 2 points to finish at 2047 while Japan’s Nikkei average slipped 95 points…
Europe
European shares are up modestly in late trading overseas…the euro zone’s deflation threat continues, however…the EU’s statistics office reported this morning that the euro zone zone’s annual inflation rate in December dipped to 0.8% from the 0.9% rate in November…the shock 0.7% rate recorded in October triggered the last ECB rate cut…
North America
North American markets are strongly in the green so far today…the Dow has climbed 115 points through the first hour of trading…the Commerce Department reported the trade deficit in the U.S. narrowed more than forecast as oil imports fell and exports rose, with the gap narrowing to $34.3 billion…
The TSX, looking to snap a 3-session losing skid to begin 2014, is up 100 points to 13596…the Venture, which has advanced for 9 straight sessions, is 2 points higher at 947…
Magor Corp. (MCC, TSX-V) Update
Magor Corp. (MCC, TSX-V) enjoyed its third-largest volume day ever yesterday, closing 2.5 cents higher at resistance at 50 cents on 370,000 shares…it climbed as high as 55 cents intra-day…MCC’s third quarter began in November with the video collaboration company enjoying its best quarterly start in history in terms of revenue…quarterly losses continue to be gradually trimmed, and the company could be on track to turn profitable later this year especially if current trials with its newly-launched Aerus cloud-based services prove successful…50 cents is a key level from a technical standpoint…a confirmed breakout on MCC would require back-to-back closes above 50 cents (refer to John’s chart yesterday)…MCC is quiet so far today with no trading through the first hour…no guarantees given the competitive arena, but Magor has some key advantages…we’ve stated all along – and continue to believe – that the potential of this tech play is truly phenomenal given the management team and its products which we’ve seen in action…Magor has been like a slow-moving train since turning public last spring but is finally picking up steam…let’s hope the momentum continues on both the business and market fronts…
Barisan Gold Corp. (BG, TSX-V)
Barisan Gold (BG, TSX-V) continues to look very healthy as 2014 begins…BG gained 3 cents Friday and another 4 pennies yesterday to close at 34 cents…there appears to be excellent support at the Fib. 27-cent level as demonstrated on the first trading day of the year…this could be a very interesting month for BG if speculation regarding drill results really ramps up and if indeed those results are as stellar as the last set that was reported November 5…
Below is a 2+ year weekly chart from John…RSI(14) is rising once again, after overbought conditions were cleansed significantly, while the overall trend remains bullish…as always, perform your own due diligence…as of 7:30 am Pacific, BG is off half a penny at 33.5 cents…
Contact Exploration Inc. (CEX, TSX-V)
Contact Exploration Inc. (CEX, TSX-V) is a promising Alberta oil and gas play very worthy of our readers’ consideration for 2014…the stock has staged a confirmed breakout above the 28-cent level (it traded in a horizontal channel between 18 and 28 cents from late 2012 to late 2013), so this is one to watch very carefully just from a technical point of view…below is a 2.5-year weekly chart from John…looks very strong…CEX is unchanged at 31 cents through the first hour of trading…
Starcore International Mines Ltd. (SAM, TSX)
A small producer we continue to like is Starcore International (SAM, TSX) which is showing an improving balance sheet as well as potential exploration upside at its San Martin Mine, 250 km northwest of Mexico City…the rising 20-day SMA at 19 cents should provide good support while the 50-day SMA has flattened out immediately beneath that at 18 cents…21 cents, where the stock is trading at so far this morning, is one resistance level as indicated in this updated 2.5-year weekly chart from John…
Note: John and Jon both hold share positions in BG. Jon also holds a share position in MCC.
Many gold stocks are shaking off the pullback in gold today very well. I think the lid is going to pop off SAM once we get a $200 increase in the price of gold, and they declare dividends. Stock is absurdly cheap. Clean balance sheet, no debt, funding exploration with their own cash.
Comment by Justin — January 7, 2014 @ 9:13 am
Starcore updated their website, looks more like a modern website. Under the Exploration section it says “coming soon…”
Comment by Justin — January 7, 2014 @ 6:18 pm