7:30 am Pacific
Canadian equity markets remain closed for Boxing Day but trading resumes tomorrow after a 4-day Christmas break with the Venture starting at its best level in 7 months and just 5% shy of a 3+ year high.
On the metals front as of 7:30 am Pacific today, Gold is up $7 an ounce at $1,281, Silver has added 9 cents to $16.47, Copper and Nickel are steady to slightly higher at $3.21 and $5.46, respectively, Zinc at $1.47 is nearing its 2017 multi-year high, while Cobalt is at another new multi-year high of $34.25.
…it all bodes very well for a strong Venture finish into year-end.
Gold Chart In Canadian Dollars
It’s often helpful to look at Gold’s performance in Canadian dollar terms to accurately gauge the near-term direction of the yellow metal.
What this 3+ year chart tells us is that Gold’s multi-year uptrend in loonie terms continues; however, momentum has waned over the past 5 months with bullion unable to penetrate Fib. resistance at $1,657 which essentially corresponds to $1,300 – $1,310 U.S. based on current exchange rates.
On Friday, bullion closed at $1,626 CDN, $1 above the 50-day moving average (SMA).
The uptrend support and the RSI(14) pattern are the most encouraging aspects of this chart.
Volatility has been unusually low in recent months, perhaps setting the stage for something dramatic in Q1.
Resistance ($1,650’s) and support ($1,600 and then $1,520 which equals $1,200 U.S.) are well-defined.
Perhaps the key takeaway from this chart is that “Decision Time” for Gold is drawing near (first half of 2018) with the uptrend line approaching Fib. resistance.
This Gold chart is somewhat indecisive but we can see that there is plenty of room to the upside if the metal can successfully overcome the $1,650’s.
Taking into account the current technical posture of the Venture, in addition to seasonal factors, the balance of probabilities in our view favors a breakout in Gold during Q1 as opposed to a breakdown. For investors, this means opportunities in high quality Gold (and Silver) producers in addition to the best speculative plays.
