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Gold has traded between $1,170 and $1,186 so far today…as of 11:00 am Pacific, bullion is up $18 an ounce at $1,181…Silver has jumped 13 cents to $16.53…Copper has slid 3 pennies to $2.52…Nickel, at $4.67, has added 2 cents…Crude Oil has gained 21 cents to $53.47 while the U.S. Dollar Index has plunged a full point to 101.46…

While yesterday’s minutes from the Federal Reserve’s December meeting showed almost all policymakers thought the economy could grow more quickly due to fiscal stimulus under the incoming Trump administration, members “emphasized their considerable uncertainty” about future economic policy changes….

Gold has benefited this week from a U.S. Dollar Index that may have hit a temporary top around stiff resistance just below 104…improving physical demand out of Asia, particularly China, in conjunction with an apparent drying up of ETF selling should give Gold a chance to soon test important new resistance at $1,200…China’s currency also made a big jump today which has helped Gold buying there ahead of Lunar Year festivities…

“Although the wider picture hasn’t changed and U.S. growth is improving, there shouldn’t be any further significant appreciation in the dollar after the strong run of the past few months and given uncertainty about economic policy changes going forward,” Commerzbank analyst Daniel Briesemann said, adding this should be supportive for dollar-denominated Gold…

Aggressive selling of Gold ETFs since early November appears to be over…holdings of the SPDR Gold Trust, the world’s largest Gold-backed exchange-traded fund, were unchanged yesterday at 813.87 tonnes after dropping about 14% since the Trump victory…

Palladium is on course for its biggest weekly gain since July after record U.S. car and truck sales for 2016 were released yesterday…the metal is off slightly at $733 as of 11:00 am Pacific, putting this week’s surge at 8.1%…Platinum has also had a great week, up nearly 8% to $970 and its highest level in a couple of months…

As we mentioned in our special New Year’s Day piece (“The Venture and Gold Entering 2017“), the extent of the thrashing that Gold took from traders following the Trump election victory should be viewed with some serious skepticism…markets, we believe, have set themselves up for disappointment in the sense that they’re anticipating too much too early in terms of economic growth…the Trump agenda of regulatory relief and broad-based corporate and individual tax cuts is the right one to fire up the American economic engine after 8 years of Obama steering a course toward socialism…however, not to mention the fact that Trump can be unpredictable, two rules of the sea also apply to the U.S. economy…

Big ships cannot stop on a dime…

Big ships do not turn very well…

“Uncertainty” is one way Gold can find its way higher…the Venture appears to be in agreement…

Goldman Sachs Ups Target For U.S. 10-Year Yield

Goldman Sachs raised its forecasts today for bond yields around the world in the coming years, predicting that the global fixed income selloff has further to run as inflation and economic growth accelerate…Goldman now expects the 10-year U.S. Treasury yield to end this year at 3.0%, up from its previous call for 2.75%, as investors price in further U.S interest rate increases and an expected fiscal boost from the Trump administration…the U.S. investment bank also said it expects higher British and Japanese yields than previously anticipated, especially UK gilt yields amid the economic and financial uncertainty surrounding Brexit and increased UK bond supply…

If the U.S. and global economy performs as well as Goldman expects, the U.S. 10-year yield will rise to around 3.25% at the start of 2018 before stabilizing around 3.50–3.75% in 2019–20…

The 10-year U.S. yield, considered the global benchmark long-term interest rate, was trading at 2.379% as of 11:00 am Pacific…according to Goldman’s analysts, that’s closer to their estimates of ‘fair value’ than at any time since 2013 but still on the low side…

The yield fell to a multi-decade low of 1.3210% in July last year but has been rising since, driven by a global bond market selloff as investors bet that U.S. and global inflation is coming back to life…

First Nations’ Financial Accountability

While most First Nations continue to comply with Stephen Harper’s financial transparency law that was controversial but long overdue, a National Post analysis has found the compliance rate fell after Justin Trudeau’s government dropped a key enforcement mechanism…the National Post reviewed all the filings published online by INAC for the fiscal year that ended March 31, 2016 and found that, of the approximately 580 First Nations required to file financial documents, 496 had done so as of January 2, 2017…that represents a compliance rate of about 85%…by comparison, for the previous fiscal year, when the enforcement provision was in effect, 534 bands filed their papers for a 92% compliance rate…how the money is being spent – well, that’s another story for another day…

Ottawa’s Financial Accountability

Governments are dangerous when they’re convinced they can make better decisions with your money than you can…that’s why Canadians should have been more outraged when the federal government in effect introduced a potential significant tax increase for individuals when it slashed the maximum annual tax-free savings account (TFSA) contribution limit from $10,000 to $5,500…the move certainly wasn’t part of any broad strategy to save the government money because there was none…after just 1 year in office, the Trudeau Liberals took a small federal surplus and magically turned it into a $30 billion deficit, 3 times higher than they promised in the election, driven by major increases in program spending that will undoubtedly become a long-term structural problem…if you don’t think that doesn’t affect you as an investor, think again…

Today we learned that the federal government, awash with money that grows on trees in Ottawa, is spending $500 million to celebrate Canada’s 150th birthday July 1…who doesn’t love a big birthday bash, but what’s really scandalous is that the largest share of the money – $300 million – is being delivered by “regional development agencies”, mostly to Liberal-friendly ridings, through the Canada 150 Community Infrastructure Program…the previous Conservative government created that fund to fix up public facilities and for community infrastructure, culture and recreation…it was given a $150 million budget shortly before the 2015 election…at the time, Liberal MPs called the program a “slush fund” because cheques were quickly handed out before the fall campaign (the accusation was apparently correct)…however, the Trudeau government’s first budget doubled the program’s size…

The Canada 150 Fund, run by Canadian Heritage, is spending $180 million on projects ranging from small and local to national cross-country tours…in just one specific example of how Canada 150 has essentially become a scam on Canadian taxpayers, the Globe and Mail reported today that Vox Pop Labs was awarded $576,500 to create a website called “Project Tessera” to offer Canadians a chance to “reflect on and develop meaningful associations with the myriad interpretations of being Canadian,” said Vox Pop CEO Clifton van der Linden, a PhD candidate in political science at the University of Toronto…he regularly appears (of course) on CBC News…the firm was also given a non-competitive $326,570 contract last year to create the MyDemocracy.ca website for the Liberals’ electoral reform drive…

Slush funds, government spending out of control, uncompetitive tax rates, stalled resource projects, climate change fanaticism, national defence and security issues, the list goes on…thankfully, our stock markets are performing well due to a rebound in commodity prices and historically low interest rates…but where are we headed as a nation is the real issue we should be reflecting on as Canada 150 approaches…

Fintech Investment On The Rise In Canada

Canada is underachieving on the resource side at the moment, but here’s a little bit of good news…Venture capital-backed investment in Canadian financial technology companies hit its highest level in almost 2 decades last year, even as the flow of funds into major fintech markets like the United States declined…according to PitchBook, used by the U.S.-based National Venture Capital Association, venture capital financing in Canadian fintech totaled $137.7 million (U.S.) in 2016, up more than 35% on the year…5 years ago, it was $21.8 million and in 2000 it was $7.3 million…

In Today’s Morning Musings…

1. A broader-based bull market bodes well for the Venture…

2. The BIG U-turn as Uranium stocks continue their uptrend…

3. Updates on 8 Venture plays on the move…

4. Investors are going to cope very well with KOPN!…

And more!

Plus more…click here to read the rest of today’s Morning Musings and all BMR exclusive content, through a risk-free Pro, Gold or Basic package, or login with your username and password…

Check back later this morning for today’s BMR Morning Market Musings.

1. Gold traded as high as $1,180 overnight and is up $13 an ounce at $1,176 as of 7:00 am Pacific…bids got supported when the ADP employment report, released at 5:30 am Pacific, showed private employers in the U.S. added only 153,000 jobs last month, below the expected 170,000…as per John’s New Year’s Day 1-year daily chart, Gold’s Fib. resistance levels on the path back to $1,200 are $1,169 and $1,195…

2. This has been a big week for both Platinum and Palladium…Platinum has jumped another $29 an ounce to $970 this morning while Palladium is $3 higher at $741…Palladium has surged 9.3% this week while Platinum is up 7.7%…

3. Oil is pushing higher again after a sudden reversal to the downside toward strong support on a volatile first trading day of 2017…WTI is up 58 cents at $53.84 as of 7:00 am Pacific, thanks in part to U.S. dollar weakness…the recent OPEC deal – the first of its kind in 8 years – has failed to quell skepticism that Oil producers would make good on their promises to limit production, given their past records of cheating on quotas…this time, however, the cartel has set up a monitoring committee to keep producers in check…the group is reportedly holding a 2-day meeting on January 21 and 22 to assess the compliance situation…

4. The Venture cut through 784 resistance like a knife through butter at the open this morning and is up 12 points at 793 as of 7:00 am Pacific…the 2nd leg of the Venture bull market does indeed appear to be in progress after a 16% correction ended December 20 just 3 points above major support at 708…

5. Dowa Metals, Japan’s largest Zinc smelting company, has exercised its option to participate as a partner in the further development of Constantine Metals‘ (CEM, TSX-V) Palmer VMS Project in Alaska…Dowa has completed its $22 million (U.S.) earn-in and a JV has been formed with CEM owning a 51% participating interesting and Dowa owning a 49% stake…Palmer is one of the best located VMS/Zinc projects in terms of getting concentrate to a hungry Asian market…in addition, CEM still holds a package of high-grade Gold properties in Ontario after recently selling non-core Gold assets there for $4.5 million cash…CEM is up half a penny at 11.5 cents as of 7:00 am Pacific…

6. In August, GoldQuest Mining (GQC, TSX-V) announced it had commenced a 40-hole, 10,000-m drill program at its Tireo Project south of its Gold-Copper Romero deposit in the Dominican Republic…today, buried in a news release, GQC revealed that by the end of December it had completed 13 of the planned 40 holes…GoldQuest says it’s currently moving the drill to the next target area and drilling is expected to recommence next week…results from Target A, released on Halloween, were frightful, and results from Target B are expected in the near future…elsewhere in the Tireo Gold Camp, Precipitate Gold has been showing more momentum and reported encouraging visuals from 4 holes completed in December at its Ginger Ridge discovery…the drill program has been expanded from the original 10–12 holes with initial results pending…

7. The BMR Top 50 Opportunities List finished with a gain of 118% at the end of 2016, vastly outperforming the markets…by comparison, for the same time frame after the Top 50 List was unveiled in early December 2015, the Venture surged 47%, the TSX climbed 14.4%, the Dow was up 10.7% and the NASDAQ added 4.7%…Gold rose 6%…the top performing individual stock in 2016 on the Top 50 List was Cordoba Minerals (CDB, TSX-V) which soared 461%…the best-performing resource stock on the Top 50 List for the 4th quarter of 2016 was Garibaldi Resources (GGI, TSX-V) with a 93% gain following confirmation of the first magmatic Ni-Cu-PGE-AU-Co massive sulphide system in northwest British Columbia’s prolific Golden Triangle…the top non-resource plays on the Top 50 List for the 4th quarter were Cannabix Technologies (BLO, CSE), up 138%, and Canopy Growth (CGC, TSX-V), up 126%…check back for more details in a complete report to be posted within the next couple of days…

Gold has traded between $1,159 and $1,168 so far today…as of 11:15 am Pacific, bullion is up $7 an ounce at $1,165…Silver has jumped 15 cents to $16.43…Copper has added 5 cents to $2.55…Nickel, at $4.65, has surged 18 cents…Crude Oil has gained 79 cents to $53.12 while the U.S. Dollar Index has fallen half a point to 103.36…

Gold is holding on to its gains despite some hawkish tones from the minutes of the December FOMC meeting, released just moments ago…the minutes show that some members could see a faster pace of tightening if the U.S. economy kicks into higher gear under a Trump Presidency and a new Congress.  “Almost all also indicated that the upside risks to their forecasts for economic growth had increased as a result of prospects for more expansionary fiscal policies in coming years,” the minutes said…

Holdings of SPDR Gold Trust, the world’s largest Gold-backed exchange-traded fund, dropped 1% to 813.87 tonnes yesterday…the rate of selling has eased in recent sessions, which is encouraging, but holdings are down about 14% since the U.S. elections in November…

Eurozone inflation accelerated at its fastest pace in more than 3 years last month as energy prices surged on the back of gains for global Crude Oil…annual inflation was measured at 1.1% for December, Eurostat said, up from a 0.6% reading in November and the fastest pace in 39 months…so-called core inflation, which strips out volatile price components such as food, energy, alcohol and tobacco prices, was measured at 0.9%, up 0.1 percentage points from November to the fastest pace since July…

Palladium Gets Lift From Strong U.S. Vehicle Sales

Palladium, which is mostly used to clean up exhaust emissions from gasoline vehicles, has soared nearly 9% in the first 2 trading days of 2017, partly in anticipation of strong U.S. vehicle sales reports…

U.S. auto makers rolled out stronger-than-expected December U.S. sales results today, amid robust demand for trucks and hefty year-end incentives, signaling the industry remained on track to set an annual record in 2016…a final tally for the year is imminent…

Sales of new U.S. vehicles reached a record of 17.47 million in 2015 and that figure should be eclipsed for 2016…the string of 6 straight years of sales gains through 2015 has not been seen since the 1920’s…however, the National Automobile Dealers Association expects U.S. sales to drop to 17.1 million vehicles in 2017 as interest rates and vehicle prices rise…that could be a pessimistic prediction, though, if the U.S. economy is able to gather steam…

Meanwhile, in China, vehicle sales were up 14% to about 25 million units through November of last year…the auto-manufacturers’ association in China projects a 13% rise in sales for 2016, more than double the 6.1% gain it forecast at the beginning of the year…

In Today’s Morning Musings…

1. Venture flirts with a breakout – what to watch for…

2. This FLYHT is taking off…

3. BLO readies for another lift-off…

4. Daniel’s Den…more on Kopin and POT!…

Plus more…click here to read the rest of today’s Morning Musings and all BMR exclusive content, through a risk-free Pro, Gold or Basic package, or login with your username and password…

Check back later this morning for today’s BMR Morning Market Musings.

1. Bargain hunters continue to pick away at Gold to begin 2017…bullion has traded as high as $1,168 today and is up $6 an ounce at $1,164 as of 7:00 am Pacific…Gold imports to Turkey rose to 36.7 tonnes in December, up from 4.65 tonnes in the same period a year earlier, their highest monthly level in just over 2 years according to data this morning from the Istanbul bourse…for 2016 as whole, imports more than doubled to 106.2 tonnes from 48.7 tonnes in 2015…

2. Palladium has surged nearly 9% in the first 2 trading days of 2017…it’s up another $30 an ounce at $738 as of 7:00 am Pacific…the jump in Palladium, which is mostly used to clean up exhaust emissions from gasoline vehicles, could be due to anticipation of record-high American vehicle sales…U.S. auto sales figures for 2016 are due to be released later today…Platinum is up again as well this morning, adding $9 to $945…

3. Oil prices are steady this morning, around $52.50, after yesterday’s volatile session to open 2017…OPEC member Kuwait lifted expectations that producers will comply with a deal to reduce oversupply after its state-owned Oil producer confirmed today that it will cut output in the 1st quarter…

4. The Venture is quickly making its key toward key resistance at 784…the Index is up another 4 points at 778 as of 7:00 am Pacific, helped by modest gains across the commodity sector…Japan and euro zone PMI’s were both strong today which has also given North American equity markets further encouragement…the Dow has climbed 37 points while the TSX has added 64 points as of 7:00 am Pacific…minutes from the Federal Reserve’s December meeting will be released later today, possibly providing more clues on the pace of rate increases anticipated this year…following that meeting, Fed officials expected rates to rise 3 times over the course of 2017…of course around the same time a year earlier, they predicted several rate increases for 2016…

5. Doubleview Capital (DBV, TSX-V), with drill results pending from the Hat Property where hole #26 in particular could deliver stellar numbers based on reported visual analysis of the core, is threatening to break out above a downsloping channel and Fib. resistance at 10 cents…DBV is unchanged at 9.5 cents as of 7:00 am Pacific…we’ll have an updated chart in today’s Morning Musings…

6. FLYHT Aerospace Solutions (FLY TSX-V), which is making major inroads into China, provided a corporate update this morning which included news that the company has further strengthened its balance sheet with the full repayment of its outstanding redeemable debentures ($3.1 million) in late December…FLYHT is a leading provider of real-time aircraft intelligence and cockpit communications for the aerospace industry…more than 60 customers, including airlines, leasing companies and original equipment manufacturers, have installed  FLYHT’s systems to increase safety, improve operational efficiencies and enhance profitability…FLY is up a penny-and-half at 25.5 cents as of 7:00 am Pacific as it attempts a confirmed breakout above resistance at 24 cents…

7. Encanto Potash (EPO, TSX-V) is the Venture volume leader in early trading with a gain of 3 cents to 10 cents (4 million shares traded on the Venture) after announcing this morning that it has completed the “foundation for an evolutionary off-take agreement” with the National Federation of Farmers’ Procurement, Processing and Retailing Cooperatives of India Ltd. (NACOF)…the memorandum of agreement (MOA) provides for a minimum supply of 5 million tonnes per year for a minimum 20-year period, pending final negotiations…the NOCOF is a national farming cooperative under the Indian Ministry of Agriculture, Government of India representing farmers in 25 states across India…

Gold has traded between $1,145 and $1,165 so far today…as of 11:00 am Pacific, bullion is up $8 an ounce at $1,159…Silver has jumped 40 cents to $16.28…Copper is flat at $2.49…Nickel is off 2 pennies at $4.50…Crude Oil briefly topped $55 a barrel before a sudden correction…it’s currently down $1.19 at $52.53 while the U.S. Dollar Index has surged one-third of a point to 103.17…

The market has carried the theme of a higher dollar, rising yields and bullish equities into 2017 – a formidable challenge to Gold…traders are expecting the U.S. economy to accelerate this year, thanks to pro-growth policies including tax cuts and regulatory relief as part of the Trump economic agenda…if higher growth doesn’t come as fast as expected, Gold should catch some strong bids and climb back above $1,200 an ounce…risks also continue to the downside, particularly if the greenback pushes significantly higher…one factor in Gold’s favor this month is the Chinese New Year at the end of January – physical buying typically picks up in China in the run-up to the New Year festivities there…

Hedge funds and money managers slashed their net long positions in COMEX Gold to a near 11-month low and trimmed bullish bets in Silver contracts in the week to December 27…

Palladium was the best performing precious metal last year, rising 20% for its biggest annual gain in 6 years…it has carried that momentum into 2017 with a jump of $30 an ounce or 4.4% to $708 as of 11:00 am Pacific…Platinum, which ended 2016 up just 1%, has surged $36 an ounce or 4.0% today to $937…

Growth in U.S. factory activity accelerated in December, a sign of stronger momentum in a key sector of the economy as 2017 begins…the Institute for Supply Management this morning said its PMI rose to 54.7 in December from 53.2 in November…economists surveyed by The Wall Street Journal had expected a December reading of 53.6…U.S. factory activity has been weak and choppy for more than a year…the ISM gauge had signaled contraction in late 2015 and early 2016 as manufacturers were squeezed by the energy sector’s slump and a strong dollar, which impacted foreign demand for U.S. exports…

Ford Motor said this morning that it plans to cancel a new $1.6 billion plant in Mexico, and instead invest $700 million in Flat Rock, Michigan…

Volatility in Oil prices this morning which hit a new 18-month high before suddenly reversing on concerns about increased production out of Libya…

In Today’s Morning Musings…

1. Kopin enters into a strategic relationship with Goertek, stock jumps 20%…

2. Top Oil stocks for 2017…

3. Long-term Venture and Copper charts show continued bullish primary trends…

4. Updates on Doubleview Capital (DBV, TSX-V) and LiCo Energy Metals (LIC, TSX-V)…

5. Silver update – major turnaround on the horizon?…

Plus more…click here to read the rest of today’s Morning Musings and all BMR exclusive content, through a risk-free Pro, Gold or Basic package, or login with your username and password…

Note:  Jon holds share positions in DBV and LIC.  Daniel holds share positions in KOPN, TAO and AOI.

Check back later this morning for today’s Morning Market Musings.

1. Gold has started 2017 in a trading range between $1,145 and $1,159…as of 7:00 am Pacific, bullion is up $3 an ounce at $1,154 despite more strength in the U.S. Dollar Index which has added half a point to 103.36 (resistance at 104)….Chinese Gold demand has been subdued recently but prices normally get a lift in the run-up to the Chinese New Year festival which will be celebrated this year at the end of January…Platinum ($939) and Palladium ($711) are both up strongly today, more than $30 an ounce each…

2. On the data front, the final read on December IHS Markit manufacturing PMI for the U.S. came in at 54.3, hitting a 21-month high while November construction spending rose more than expected as it reached better than a 10-year high… 

3. China’s Shanghai Composite, coming off its worst year since 2011, jumped 33 points or about 1% overnight to kick off 2017 after a private manufacturing survey exceeded expectations and showed a significant pick-up in factory activity in December…

4. The Venture is now challenging a key resistance band between 770 and 784…the Index is up 6 points at 769 as of 7:00 am Pacific, helped by rising Oil prices (18-month high) and strength in the broader equity markets…the Dow has climbed 126 points while the TSX has surged 150 points to 15,437…

5. A major property deal (LOI) announced this morning by LiCo Energy Metals (LIC, TSX-V)…the company has signed a non-binding Letter of Intent with Durus Copper of Santiago, Chile, whereby LiCo can earn up to a 60% interest in the Purickuta Lithium Project located within Chile’s Salar de Atacama, the world’s largest and purest active source of Lithium…the LOI, when followed by a definitive option agreement, will require LiCo to make certain cash payments totaling $8.4 million (U.S.), issuing 5 million shares and making certain work and development commitments during the term of the option agreement…LIC is up a penny at 14.5 cents as of 7:00 am Pacific…

6. MGX Minerals (XMG, CSE) reported this morning that it has successfully extracted Lithium from heavy Oil waste water…results are part of the ongoing optimization for completion and deployment of a pilot plant in support of its 487,000 hectare Alberta Lithium Project…the company owns a patent pending process (United States Provisional Patent #62/419,011) for the extraction of Lithium and other valuable minerals from Oil brine…this technology is the first of its kind, reducing production time of Lithium from brine by 99% compared with conventional Lithium brine production times that use solar evaporation…process time is reduced from approximately 18 months to 1 day using MGX’s process…XMG gapped up to 60 cents to a new 52-week high and is holding on to those gains through the first 30 minutes of trading…

7. Garibaldi Resources (GGI, TSX-V), one of the top-performing junior resource stocks in Q4 with a 93% advance, has commenced detailed 3D modeling of the first magmatic Ni-Cu-PGE-Au-Co massive sulphide system (E&L deposit) in the heart of northwest B.C.’s Golden Triangle, 10 miles southwest of Eskay Creek and 20 miles west of Pretium’s Brucejack high-grade Gold mine which is slated for commercial production during the 2nd half of this year…in addition, GGI has outlined a 10-km-long mineralized corridor at its 100%-owned Red Lion Cu-Au Project contiguous to Kiska Metals‘ (KSK, TSX-V) Kliyul Project, now falling into the hands of AuRico Metals (AMI, TSX) after a takeover announcement last week… meanwhile, GGI has near-term drilling lined up at its Tora Tora Property (Au-Ag-Cu-PGE) north of the producing Copper Mountain mine near Princeton and contiguous to a 75 sq. km package held by a private company indirectly controlled by Robert Friedland…GGI is up a penny at 14.5 cents as of 7:00 am Pacific…

Happy New Year again on this first day of 2017!

Our January 1, 2016, predictions for both the Venture and Gold were bang-on.  Hopefully we’ll be as lucky this time around, though discerning the markets with so many volatile political dynamics – not just in the United States but elsewhere – is a challenging task indeed.

Venture Update

Last year, one of the most encouraging signs in the final quarter was the resilience of the Venture in the face of a fresh wave to the downside in commodities.  This year, another bullish 4th quarter anomaly was how the Venture held up so well against a big drop in Gold and a powerful run to 14-year highs in the U.S. Dollar Index.

The Venture fell just 4.8% in Q4 despite a 12.5% drop in the price of Gold and an 18.5% decline in the TSX Gold Index.  The Venture’s pullback from a high of 848 in mid-August to a low of 711 December 20 – just 3 points above the top of an exceptionally strong support band – was very consistent with previous corrections during bull markets.

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