The Venture snapped a 4-session losing skid today with a gain of 4 points to finish at 548, its EMA(8) which is also just 6 points below important resistance at the EMA(20).
This is a critical week for the Venture and all markets, for that matter, given Thursday’s much anticipated Fed policy statement and Janet Yellen news conference.
Most of the indicators on John’s 4-month daily chart for the Venture remain encouraging. Below are some key takeaways:
1. Key resistance remains the EMA(20), currently 554, and the 560 level. A confirmed breakout above this resistance band would give the Index fresh momentum – it would also verify that the Venture is in the midst of a significant rally;
2. RSI(14) has climbed out of oversold conditions which it had been trapped in since the beginning of July. It’s currently at 42%, ticking slightly higher after today’s trading;
3. Low bullish cross forming in the SS;
4. The recent bearish trend (ADX indicator) has weakened dramatically since the August 24 low;
5. Fib. support at 515 has held – on a monthly basis, Fib. support around 560 also held in August. One cannot rule out the possibility of a double bottom at the 515 Fib. level;
6. Fib. resistance above the EMA(20) starts at 586.
If the Venture pushes past 560 on a closing basis on increased volume, that will be the signal for longs to really get aggressive – keeping in mind the need to focus on the “leaders” of the market.
More than ever, the Venture needs a fresh grassroots discovery in Canada. Two immediate possibilities on the horizon – Equitas Resources‘ (EQT, TSX-V) exciting Garland Nickel Project near the Voisey Bay’s mine, and Garibaldi Resources‘ (GGI, TSX-V) vast Grizzly Central area in a district where a second deposit has already been found and more appear to be a virtual certainty.
Note: John and Jon both hold share positions in EQT and GGI.
