Gold has traded in a tight range between $1,603 and $1,612 so far today…as of 5:40 am Pacific, the yellow metal is down $5 an ounce at $1,607…Silver is 24 cents lower at $27.86…Copper is off 2 pennies at $3.41…Crude Oil has retreated 29 cents at $93.38 while the U.S. Dollar Index is up over one-tenth of a point at 82.50…
Since late 2010, Gold stocks have been significantly under-performing Gold though stocks have recently started to play “catch-up” – it’ll be interesting to see if this trend accelerates through the remainder of this quarter…
Today’s Markets
Asian markets were mostly higher overnight with China’s Shanghai Composite inching up 3 more points to 2160…European shares are modestly lower this morning while stock index futures in New York as of 5:45 am Pacific are pointing toward a slightly lower open on Wall Street after a three-day rally that has pushed the Dow up 300 points…the Venture Exchange closed yesterday at 1191, a 4-point gain, on increased volume…a move through the 1200 level would confirm the start of a new uptrend…
Strength In Commodities
Two currencies that are showing underlying strength in commodities are the Canadian and Australian Dollars, which ultimately is a bullish sign for the Venture Exchange…the Leaping Loonie has surged more than 4 pennies since bottoming out just below 96 cents at the end of May…it’s trading this morning just slightly above par at 1.0028…the overall uptrend in both these currencies has been very pronounced over the last couple of months and should continue…below is a chart from John that compares the relationship between the Canadian and U.S. Dollars (blue line) and the Australian Dollar and the Japanese Yen (black line)…
Euro
Another important currency to watch these days, of course, is the euro…a trend reversal appears to have occurred in the euro which should be bullish for Gold and the equity markets in general…below is a 2.5-year weekly chart update for the euro which has plenty of upside potential from current levels, part of which could be fueled by a short squeeze (the shorts could get burned in a hurry, given this chart, if they’re not careful)…
Slew Of Chinese Economic Data Tomorrow
Markets will be combing through a slew of data that China is releasing tomorrow including the consumer price inde x, fixed asset investment, retail and industrial production…meanwhile, the Wall Street Journal reported recently that China has quietly increased its budget for railway investment this year by 16%, according to data from the Ministry of Railways…in its latest bond prospectus published on Chinabond, an official website for debt issues, the railway ministry said it plans to spend 470 billion yuan ($73 billion) on infrastructure investment this year, up from the 406 billion yuan stated in the previous prospectus…spending on railway infrastructure in the second quarter slipped to 7.6% year-on-year, down from 8.1% in the first quarter, for its slowest pace in more than three years…data from the railway ministry showed that it spent 148.7 billion yuan on infrastructure investment in the first half of 2012, down 39% from a year earlier…
Bank of England Cuts Growth, Inflation Forecasts
The Bank of England this morning cut its forecasts for growth and inflation in the U.K. economy, giving investors a signal it could inject further stimulus in the coming months…the U.K.’s central bank said in its quarterly inflation report that the damaging economic effects from the financial crisis could persist longer than previously thought, while inflation is likely to fall below target from mid-2013 and remain there for two years…the central bank said the biggest risk to any recovery comes from the euro zone, and specifically the danger that leaders will delay in resolving their long-running fiscal crisis…the new forecasts come after BOE rate setters voted in July to pump an additional 50 billion pounds ($78.1 billion) into the economy through asset purchases with newly created funds, raising the ceiling of its quantitative easing program to nearly $600 billion…
Everton Resources (EVR, TSX-V) Chart Update
Not surprisingly, Everton Resources (EVR, TSX-V) finally broke through resistance at 10 cents yesterday and closed the day up 2.5 cents at 12.5 cents on total volume (all exchanges) of 1.7 million…the case for Everton is strong given the big jump in interest in the Dominican Republic due to GoldQuest Mining’s (GQC, TSX-V) Romero discovery…the Law of Supply and Demand is at work here as most of the prime exploration land in the DR is held by just three juniors – GoldQuest, Unigold (UGD, TSX-V) and Everton…GoldQuest and Unigold are much further along, of course, but Everton at a dime is simply too good to pass up…part 2 of our interview with EVR President and CEO Andre Audet will be posted later this week…in the meantime, below is an updated EVR chart from John after yesterday’s jump…
Note: Both John and Jon hold share positions in EVR.
Hello John::
I enjoy your publication daily. Good work..
John Have you ever looked at Loncor [Ln.v]. I like it because of results from Makapela which now has over 1.0 oz. drilled off. Newmont has bought a 18% equity in loncor. But the stock is trendless market wise.
Any opions from you are appreciated.. thank you john kobilan.
Comment by john kobilan — August 8, 2012 @ 6:46 am
I think someone got a gift@ .21 on RBW today
Comment by BRIAN — August 8, 2012 @ 8:02 am
The gift was .135 and .14 Brian, not .21.
You could see RBW at .17 or .18 here shortly again before it moves up again.
Comment by dave — August 8, 2012 @ 8:18 am
TOAYS SMILE. A misspelled word in a church bulletin may give one a wrong impession. THE CHOIR will be sinning next Sunday and will be meeting on THURSDAY TO PRACTICE
Comment by gil — August 8, 2012 @ 8:47 am
Nothing to worry about in RBW as this is normal in light trading. Same for GQC to get back to $1.55 or so. Low volume so far and this one will move up to historic high before going down at $1.6 level. GBB may go below 0.08 but it is not the right time to scoop it.
Comment by Theodore — August 8, 2012 @ 8:48 am
Hi BMR, were you able to track down Johnston yesterday for an update?
Comment by Dan — August 8, 2012 @ 9:51 am
He’s agreed to a short interview but not until tomorrow, which makes me think something’s up. He did say things are right on schedule for drilling.
Comment by Jon - BMR — August 8, 2012 @ 10:04 am
Right on. Thanks Jon.
Comment by Dan — August 8, 2012 @ 10:07 am
Dave where do you come up with this stuff? You really think RBW is going to sell thru over 200k on the bid back down to 18c? What is your logic behind that? we spent the last week trading around and above 18c….dont think we will see many sellers the next few weeks…
Comment by db — August 8, 2012 @ 11:34 am
Not that i am siding with Dave, but nothing is definite in this market.
Although i feel RBW will eventually move up, it could move one way or
another with the market, until we get something definite on drilling, or
the placement, or whatever. The long delay in getting the permit(s), gives
one a reason to again pause & reflect on what we already went through, it was
like eternity, but not what we were made to believe in the beginning, now some
may be more cautious than ever. I sold out once, for what i felt at the time,
was ‘tardiness’. Yesterday, i tried to sell a few, but only managed to move 3k
at 0.225, the buyers just weren’t interested. Why did i do this ? simple, still
lacking of confidence, i just felt i had to take some off the table. I never
look back after i sell.. It may be ok for RBW, they are in the know, but for
shareholders, it’s the unknown, which drags us down & companies should realize
this.. The only thing keeping me going, is our friends at BMR. I am still a RBW
shareholder, which gives me a right to speak out. R !
Comment by Bert — August 9, 2012 @ 3:40 am