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Gold is firmer this morning as it fights to re-take the $1,600 level…as of 8:20 am Pacific, the yellow metal is up $6 an ounce at $1,595 after climbing as high as $1,603…Silver was higher but is now off a nickel at $29.22…Copper is up a penny at $3.71…Crude Oil is 14 cents higher at $96.95 while the U.S. Dollar Index is relatively unchanged at 80.08…

Today’s Markets

Markets are trying to recover today and are mostly in the green, despite weaker-than-expected Chinese trade data, with the Venture Exchange up 16 points at 1362 as of 8:20 am Pacific…one or two days does not a trade make, but the TSX Gold Index reversed strongly yesterday after finding support at the 280 level…in two-and-a-half months this Index has fallen 29% (since last summer the drop has been a stunning 38%)…the Venture, meanwhile, has lost as much as 373 points or 22% since February 29…as John’s chart below shows, the Gold Index found support at the bottom of a 2.5-month downtrend channel yesterday…what it may now attempt to do is test the upper portion of that channel…the first real sign that the Gold stocks may have bottomed out is if this downtrend channel can be broken to the upside…we’ll keep an eye on it…

As of 8:20 am Pacific, the TSX Gold Index is up 2 points at 293…

Anglo Swiss Resources (ASW, TSX-V)

The potential for flake graphite in the Slocan Valley region of southeast British Columbia is becoming more apparent, and Anglo Swiss (ASW, TSX-V) is turning its guns to its Blu Starr Property immediately south of Eagle Graphite’s mill…ASW jumped 33% on the news yesterday that it’s commencing a prospecting program at Blue Starr…over the years, the company has spent well over $1 million exploring this property but they’ve never drilled it…while their original target was Gold, it appears Blue Starr is much more prospective for flake graphite…the 6,473-hectare property covers high-grade metamorphic rocks of the Valhalla Metamorphic Complex…in the northern part of Blu Starr, up to 15% graphite has been mapped in outcrop and appears to be associated with a 3-km long EM anomaly identified in an airborne geophysical survey completed by the company two years ago…less than 25% of the property was covered by this airborne survey…just over 20 kilometres to the north is Eagle Graphite’s deposit which has the potential to be world class…it seems this large stretch of ground in the West Kootenays has undergone very special geological processes that have given rise to conditions that support the formation of flake graphite deposits…much of the investing public is unaware of the story given the fact that Eagle Graphite is a private company…rumor on the street is that Eagle Graphite could go public…what’s particularly special about this situation is that Eagle is likely to be the only producer of flake graphite in western North America for at least the several years…

ASW closed at 6 cents yesterday (right at its rising 100-day SMA) and below is a chart from John that shows some encouraging technical signs…

Note:  Jon holds a position in ASW (John and Terry do not)…

Bank of England Stops QE

The Bank of England voted not to give Britain’s struggling economy another cash injection today as concerns over stubbornly high inflation outweigh the risk of a prolonged recession and renewed dangers from the euro zone debt crisis…but after buying 325 billion pounds of government debt with newly created money, 50 billion pounds of which has been purchased in the last three months, the Bank has judged that its policy stance is supportive enough…the central bank also left its key interest rate unchanged at a record low 0.5%…both decisions had been widely expected, though a significant minority of economists still think the central bank may eventually do more easing…the central bankers based their votes on updated growth and inflation forecasts that Bank of England Governor Mervyn King will announce next week…