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Gold has been given a major boost from developments in the strategic Crimean peninsula of Ukraine where Russian forces have seized control, sparking a diplomatic war of words between Russia and the West unlike anything seen since the end of the Cold War…bullion, trying to overcome stiff resistance at $1,350, flirted with that level overnight, pulled back slightly, and now has pushed past $1,350…it’s up $24 an ounce at $1,353 as of 7:45 am Pacific…Silver has climbed 36 cents to $21.58…Copper is off 2 pennies at $3.19…Crude Oil, thanks to Russian muscle-flexing, has surged $2.10 a barrel to $104.69 while the U.S. Dollar Index is up one-tenth of a point at 79.94…

Russian President Vladimir Putin continues to run roughshod over U.S. President Barack Obama whose glaring weaknesses on the international stage become more evident each day…the West has no Ronald Reagan or Margarget Thatcher to stand up to the Russians now, so Putin knows he can push the envelope…however, blowback in the form of international economic sanctions against Russia, the world’s largest energy exporter, could be extremely painful for the country…Russia is already struggling economically and the tumbling ruble is making it difficult for the central bank to contain inflation…the U.S. and its European allies are vowing to isolate Putin and punish his nation’s economy, but of course there could also be costs associated with that for the West…”safe haven” capital is flowing into Gold, not the greenback, demonstrating just how weak the U.S. dollar is right now…a test of critical support at 79 on the U.S. Dollar Index seems almost certain…

We’ll probably see more of this in the coming days and weeks – Citi Research has just raised its 2014 Gold and Copper forecasts, although both are below current prices…in a research report released last night, the bank upped its 2014 Gold forecast by 4% to $1,303 an ounce and its Copper forecast by 5% to $3.16 per pound…

Today’s Markets

Asia

There was no “risk-off” mood in China overnight…an easing of cash rates and a stabilization of the yuan helped propel the Shanghai Composite to a 19-point gain overnight as it closed at 2075…the final reading today from HSBC on China’s factory for February activity showed a drop to a seven-month low of 48.5, marking the third straight monthly decline…however, the reading was slightly above the flash reading for February of 48.3…

Japan’s Nikkei hit a one-and-a-half week low on concerns over Ukraine and a strengthening yen…the Nikkei fell 189 points or 1.27%…

Europe

European shares are down significantly in late trading overseas with the unstable situation in the Ukraine weighing on investors’ minds…

North America

The Dow has retreated 157 points as of 7:45 am Pacific…U.S. consumer spending rose more than projected in January, with household purchases up 0.4% after a minuscule 0.1% gain the prior month…it’s a huge week for U.S. economic data which will include the ADP employment report on Wednesday and non-farm payrolls from the Labor Department Friday…

The TSX, benefiting from higher Oil and Gold prices, is up 14 points while the Venture is 3 points lower at 1022…

Venture 14-Year Monthly Chart:

This “big picture” Venture chart from John shows how the CDNX has climbed out of a bear market with a new bullish phase now clearly underway…the next major chart resistance is around 1150 while a test of the first Fib. resistance level of 1467 seems quite possible for 2014…obviously, it won’t be a straight climb up – there will be volatility and pullbacks along the way…investors need to pay attention to important support and resistance areas, and understand the main trend which is now up…note on this chart how the RSI(14) is emerging from a bullish low “W”…in addition, buy pressure has now replaced sell pressure which was dominant on this long-term monthly chart since mid-2012…

A lot of wreckage has been left behind following the devastating 65% drop from the 2465 early 2011 high to the late June 2013 low of 859…and many companies are still struggling to raise money…but capital is flowing into the strong plays, companies with solid management and geological teams, and properties of high merit…it’s our view that northwest B.C.’s prolific Sheslay Valley will pour gasoline on the Venture fire in the coming weeks and months, and discoveries elsewhere will also come into play to bring investors back into this market…

Below is John’s updated 3-year weekly Venture chart from John…buy pressure has steadily been increasing and RSI(14) at 65% is still shy of being in overbought territory…note how the Index broke out above a long-term downtrend line in October, tested that downtrend line repeatedly as new support, and then took the path of least resistance – up – right before Christmas…the birth of a new bull market (somewhat selective, perhaps, but a bull market nonetheless)…

Kaiser:  “Selective Resource Sector Bull Market Is On The Way”

Comments from John Kaiser on the first day of PDAC:

“After three years of a relentlessly brutal bear market, a bottom has been reached and a selective resource sector bull market is on the way,” Kaiser said. “It is not going to be a repeat of the last decade. Now is the window where the best, the biggest, money can be made in the resource juniors because everything has had their evaluations flattened, it’s like a slaughter field, and now we’re watching the survivors stand-up.”

Barisan Gold Corp. (BG, TSX-V) Update

Another Cu-Au porphyry discovery we’re continuing to follow with great interest is in Indonesia where Barisan Gold (BG, TSX-V) reported this morning that hole UTD-005, still in progress (good news), had reached a length of 836 metres as of Friday…“The higher-grade zone forecast to be intersected from 525-675 metres seems to have been extended further to the current depth of 836 metres and seems to continue at depth,” Barisan stated, based on visual analysis as no assays have yet been received for the hole…

As of 7:45 am Pacific, BG is up 3.5 cents at 27 cents…John’s 2+ year weekly chart shows that BG could be ready to break out above a bullish flag…

Reservoir Minerals Inc. (RMC, TSX-V)

Reservoir Minerals (RMC, TSX-V) keeps rolling along and what a success story it has turned out to be, and that’s tremendous for this market…on February 20, the company announced that it had arranged a pair of financings (non-brokered and a bought deal) at $5.75 per share for total gross proceeds of up to $33 million…this came a couple of days after RMC reported more spectacular drill results from the high sulphide epithermal resource within the Cukaru Peki Copper-Gold deposit in Serbia…hole FMTC 1338 intersected 205.6 m grading 4.81% Cu and 2.88 g/t Au for 6.54% CuEq…meanwhile, wide-spaced drilling to the east and north continue to yield long intercepts of associated porphyry-style Copper-Gold mineralization…the deposit forms part of the Timok Project, a joint venture between Reservoir and Freeport-McMoRan Copper & Gold Inc. (FCX, NYSE)…quite simply, RMC and Freeport have a great deposit on their hands with strong upside potential to increase resources through infill drilling and the likelihood of extensions to the system…in addition, other areas of the Timok magmatic complex (100% held by Reservoir) are highly prospective for fresh discoveries…this is a winner, plain and simple, which is why we included it in our late December list of 20 companies to watch closely in 2014…

Technically, RMC is now meeting measured Fib. resistance around $7.50, raising the possibility of a minor pullback to unwind temporarily overbought conditions…the 20-day SMA, currently just below $6, has provided consistent support since last year…RMC is down 7 cents at $7.32 as of 7:45 am Pacific…

Probe Mines Ltd. (PRB, TSX-V)

One of the top exploration plays in Canada is unquestionably Probe Mines (PRB, TSX-V) and its advanced Borden Lake Project in northwestern Ontario…despite the three-fold increase in PRB since April-May of last year, there is still plenty of potential upside in this stock as continued drilling attempts to extend the high-grade zone to the southeast…meanwhile, grades continue to improve in the potential open-pit mineralized zone to the northwest…this is a multi-million ounce deposit that a major will most certainly want to acquire in our view…

The PRB chart is quite simple – very strong support at $3…the next Fib. resistance is around $4.25…PRB is down a dime at $3.20 through the first 75 minutes of trading…

Silver Short-Term Chart

Silver has been finding support at its 200-day moving average (SMA) just above $21, and its major near-term challenge will be to power through two resistance areas – $21.45, and a band between $22 and $23…the trend is clearly bullish, so it wouldn’t be surprising if there’s at least a strong attempt by Silver to get through $23 sometime this month…

Long-Term Silver Chart

RSI(2) on the Silver long-term chart (11-year monthly) is often a very reliable indicator of near-term moves, and what it’s telling us now is that Silver still has room to move higher in the immediate future but temporarily overbought conditions would likely emerge and this would be followed by some consolidation before the next leg up…sell pressure has been dominant since early last year but is clearly weakening…if and when Silver breaks above the downtrend line, watch out…

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

TSX Venture Exchange and Gold

The Venture posted its fourth consecutive weekly gain, albeit a modest 3-point advance to finish February at 1025.  For the month, the Venture was up a whopping 8% which compares to a 4% increase in the Dow, a 5% jump in the Nasdaq, a 3.8% climb in the TSX and an 8.8% surge in the TSX Gold Index.  The fact that the Venture is out-performing the broader indices is a very positive sign, yet another indication the bear market in juniors is over.

This 5-year weekly Venture chart shows the new phase the CDNX is now in – the downtrend line since 2011 has been overcome, the 200-day moving average (MA-40 on this weekly chart) has reversed to the upside, and the next major chart resistance is 1150.  The Index has held above the 1000 level for nine straight sessions.  Superb support exists in the 970’s which of course was very stiff resistance for many months. A short-term pullback is possible in March, or momentum may continue to take the Venture higher before a minor correction sets in.  Just keep the big picture in mind (the main trend is bullish) and the immediate resistance and support levels.

Quite simply, the Venture is now in the very early stages of a new bull market in our view. A lot of wreckage has been left behind following the devastating 65% drop from the 2465 early 2011 high to the late June 2013 low of 859.  And many companies are still struggling to raise money.  But capital is flowing into the strong plays, companies with solid management and geological teams, and properties of high merit.  It’s our view that northwest B.C.’s prolific Sheslay Valley will pour gasoline on the Venture fire in the coming weeks and months, and discoveries elsewhere will also come into play to bring investors back into this market.

Below is an updated 5-year weekly Venture chart from John.  It won’t be a straight climb up – there will be volatility and pullbacks of course along the way – but a strong argument can be made that we’ll see the Venture hit the first Fib. resistance level of 1465 at some point this year – more than a 40% increase from current levels.  That’s the kind of environment that produces “10-baggers” for investors.

The Seeds Have Been Planted (And Continue To Be Planted) For The Next Big Run In Gold Stocks

There’s no better cure for low prices than low prices.  The great benefit of the collapse in Gold prices in 2013 is that it forced producers (at least most of them) to start to become much more lean in terms of their cost structures. Producers, big and small, have started to make hard decisions in terms of costs, projects, and rationalizing their their overall operations.  Exploration budgets among both producers and juniors have also been cut sharply.  In addition, government policies across much of the globe are making it more difficult (sometimes impossible) for mining companies to put Gold (or other) deposits into production, thanks to the ignorance of many politicians and the impact of radical and vocal environmentalists (technology has made it easier for groups opposing mining projects to organize and disseminate information, even in remote areas around the globe).   Ultimately, all of  these factors are going to create a supply problem – think about it, where are the next major Gold deposits going to come from? On top of that, grades have fallen significantly just over the past decade.

It doesn’t take a rocket scientist to figure out that the next huge bull market in Gold stocks is just around the corner due to demand-supply dynamics, much leaner producers who will suddenly become earnings machines, and a junior market that will be healthier simply because a lot of the “lifestyle” companies sucking money out of investors will simply disappear or get taken over by individuals or groups who are actually competent and serious about building shareholder value.   A healthy “cleansing” in the market has been taking place.  As this continues, more and more seeds are being planted for an incredible future move in well-managed Gold producers and explorers that could make the dotcom bubble look like a tea party.  As for the juniors, focus on the small universe of companies that have the ability to execute both on the ground and in the market.  Companies that are strong financially, have superior exploration prospects, competent management and clean share structures.

Gold

Gold posted its best monthly performance since July of last year, and the question now is whether certain dynamics can come into play – geopolitical events (Ukraine), physical demand, short covering, U.S. dollar weakness, etc. – that can drive bullion through stiff resistance around $1,350 where it reacted last week.

The situation in the Ukraine is being viewed in many quarters as the biggest geopolitical risk event in some years, so it’ll be interesting to see how Gold and equity markets respond in the coming week.  Russia, however, is flexing its muscles at a time of weak leadership in the United States and elsewhere in the West, so who exactly will stand up to Vladimir Putin?  Nobody, really, and Putin knows that.  There is no Ronald Reagan or Margaret Thatcher on the world stage, and Obama lacks the will to even approve Keystone let alone stand up to an international bully.  We don’t want to downplay the significance of events in the Ukraine; however, be careful not to fall victim to the mainstream media’s fear-mongering over events there and how they could impact equity and other markets (instead, use their coverage to your trading advantage).

February was a key month for Gold as it broke above a downtrend line in place since the beginning of 2013.  For the week, bullion was up $3 an ounce as it closed at $1,329.  Buy pressure is strong as shown in this 9-month daily chart, while RSI(14) has backed off slightly (now at 65%) from recently overbought conditions.  The 200-day SMA at $1,304 provides solid new support.

Silver fell 63 cents last week to close at $21.23 (resistance band between $22 and $23).  Copper lost a nickel to $3.22.  Crude Oil climbed 39 cents to finish at $102.50 while the U.S. Dollar Index tumbled half a point to close at 79.78.  A test of critical support at 79 seems likely in the near future.  It’ll be interesting to see how the greenback reacts to the Ukraine crisis.

The “Big Picture” View Of Gold

As Frank Holmes so effectively illustrates at www.usfunds.com, the long-term bull market in Gold has been driven by both the Fear Trade and the Love Trade.  The transfer of wealth from west to east, and the accumulation of wealth particularly in China and India, has had a huge impact on bullion.  Despite Gold’s largest annual drop in three decades in 2013, the fundamental long-term case for the metal remains solidly intact – currency instability and an overall lack of confidence in fiat currencies, governments and world leaders in general, an environment of historically low interest rates, a Fed balance sheet now at $4 trillion and still expanding, money supply growth around the globe, massive government debt from the United States to Europe, central bank buying, flat mine supply, physical demand (especially from China), emerging market growth, geopolitical unrest and conflicts…the list goes on.  However, deflationary concerns around the globe and the prospect of Fed tapering had a lot to do with Gold’s plunge during the spring below the technically and psychologically important $1,500 level, along with the strong performance of equities which drew “momentum traders” away from bullion.  June’s low of $1,179 was likely the bottom for Gold.  Extreme levels of bearishness emerged in the metal last year.  With the long-term bull market remaining intact, we expect new all-time highs in Gold as the decade progresses.  Inflationary pressures should eventually kick in around the globe after years of ultra-loose monetary policy.

We are in the process of updating our eAlert list, especially in light the much improved Venture outlook for 2014.    If you wish to be included in the BMR eAlert system, which sends out occasional important and timely market information that’s not always posted on our site (or before it’s posted on our site), simply click on the “Contact Us” button you see in the top right hand corner of this page, type in “Alert” in the subject line, give us your first name, and hit the send button.  Your email address is not given out to any other party.

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IMPORTANT:  If you are already an eAlert subscriber, or if you’re about to become one, please ensure you add “[email protected]” to your email contact list.

Welcome to our site, or at least the initial version of it!  BMR has been online for more than four years and strictly through word-of-mouth we have built a loyal following.  We encourage reader feedback and the exchange of helpful opinions and ideas among investors in our forum. 

We’re continuing with our plans to ultimately construct a very unique investment and money-management resource site that goes considerably beyond what we have now.  We focus a great deal on the Gold, Silver and Copper markets as well as trends in the global economy, in addition of course to the technical health of the TSX Venture Exchange (CDNX).  An important component of this site, as well, will always be original research on high quality junior exploration companies or small producers that offer very real and significant upside potential. We are extremely selective in the companies we feature and put forward to investors – we prefer quality over quantity, and we are being more selective than ever in the current market environment.  We look for companies with the ability to execute both on the ground and in the market, who are determined to build shareholder value, which actually excludes most Venture stocks.  However, investors must understand that the companies we do put forward for our readers’ due diligence are still highly speculative situations and entail considerable risk, volatility and unpredictability.

Our intent is to provide you with information that you can use as part of your own due diligence.  Our stock coverage is for informational and entertainment purposes only and must not be viewed or interpreted as “buy”, “sell” or “hold” recommendations. We are not Registered Securities Advisers. Our opinions can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Adviser operating in accordance with the appropriate regulations in your area of jurisdiction. Always perform your own due diligence and please read our disclaimer at the bottom.

We use a combination of fundamental and technical factors in determining the value and potential of a stock.  In terms of fundamentals we look for a company with a superb project supported by strong management.  Management must possess integrity, solid ethics and a determination to succeed and build shareholder value.

At BullMarketRun (BMR) we approach the handling of money from a biblical perspective and this is an important topic we will be sharing with our readers (and listeners) as the site continues to develop. The Bible teaches so much about money and how to handle it and invest it –  there are literally thousands of verses on how we should handle the money and possessions that God entrusts us with.  By examining the life of Jesus and reading the Word of God, we can all become fully equipped to be successful investors and handle money wisely.  We have a God who thinks big – He created the universe – and He wants us to think big  in every area of our lives.  When we handle money from a Biblical perspective (His money that we have been given stewardship of), He will bless you.  This all begins, of course, with a personal relationship with Jesus Christ by accepting Him as your Lord and Savior and putting Him at the throne of your life.  It is the most important decision you’ll ever make.

God Bless,

Terry Dyer

Owner/Publisher, www.BullMarketRun.com

Disclaimer:

BullMarketRun.com (BMR) is completely independent from any companies it covers.  BMR accepts no compensation of any kind from any groups, individuals or corporations for coverage of any company mentioned on this site.  We accept no advertising either.  Our stock coverage is for informational and entertainment purposes only and must not be viewed or interpreted as “buy”, “sell” or “hold” recommendations. No investment opinion or other advice is being rendered on any stock or company. We strongly recommend that you consult with a qualified investment adviser, one licensed by appropriate regulatory agencies in your legal jurisdiction, and do your own due diligence and research before making any investment decisions. The stocks we cover, by definition, are highly speculative and potentially very volatile. Investors are cautioned that they may lose all or a portion of their investment if they make a purchase or short sale in these speculative stocks.  We are not Registered Securities Advisers. Our opinions can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Adviser operating in accordance with the appropriate regulations in your area of jurisdiction. It should be assumed that BMR personnel, writers and their associates may hold or dispose of or trade in positions in any securities mentioned herein at any time.  Owner/Publisher of BullMarketRun.com is Terry Dyer of Langley, British Columbia.

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All statements in BMR’s reports, other than statements of historical fact, may be forward-looking statements. These statements relate to future events or future performance. Forward-looking statements are often but not always identified by the use of words such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar expressions. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements.