Gold has traded between $1,216 and $1,231 so far today…as of 8:20 am Pacific, bullion is down $2 an ounce at $1,224…Silver is up 6 cents at $17.11…Copper has added 2 pennies to $2.95…Crude Oil is off 33 cents at $60.61 while the U.S. Dollar Index has surged nearly two-thirds of a point to 88.67…
An improvement in sentiment toward Gold was seen yesterday in the holdings of SPDR Gold Trust…the fund saw inflows of nearly 3 tonnes, bringing total holdings to 724.80 tonnes, up about 1% after recently hitting a 6-year low…
Outflows from all Gold ETF’s are 114,000 ounces so far in December, with the pace having slowed considerably from the last 3 months, according to UBS. “If the current average rate of change in Gold ETFs is maintained for the rest of the month, selling should be limited to about a quarter of average monthly liquidations so far in Q4,” the bank stated. “Interestingly, Gold ETFs are up so far this week, and if the trend continues today and tomorrow, this will be the first weekly net inflow since September.”
Oil Update
Global demand for OPEC Crude in 2015 is expected to fall to its lowest in more than a decade and far below current output, the group said yesterday, indicating a hefty supply surplus without OPEC output cuts or a slowdown in the U.S. shale boom…however, pundits predicting the imminent demise of OPEC ought to keep in mind this statistic from the International Energy Agency: OPEC’s share of the global Oil market will rise to 49% by 2040, from 42% currently, as non-OPEC resources dry up…
Iranian President Hassan Rouhani blamed falling Oil prices on “treachery” in an apparent dig at rival Saudi Arabia, according to news wires yesterday…the Iranian leader also called the drop in prices “politically motivated” and a “conspiracy” against the interests of the region. “Iran and people of the region will not forget such conspiracies, or in other words, treachery against the interests of the Muslim world,” he was quoted as saying, during a Cabinet meeting…
The Wall Street Journal reported last night that U.S. energy companies are starting to cut drilling, lay off workers and slash spending in the face of the continued decline in Oil prices…the number of rigs drilling for Oil in North Dakota and parts of Texas has started to edge down, new drilling permits have dropped sharply since October, and many companies say they are going to focus on their most profitable wells…Houston-based EOG Resources Inc. is closing its Calgary office after selling almost all of its Canadian Oil and gas producing assets as it refocuses in the U.S. Matador…
WTIC 2-Year Weekly Chart
Below is an updated 2-year weekly WTIC chart that shows how Crude completely broke down after falling below its long-term support trendline beginning in August – that was a huge “red flag”…
RSI(2) is currently at a low extreme – just 1.3% – which makes fertile ground for some sort of a rally out of such temporarily oversold conditions…expect the “smart money”, however, to sell into any rallies…
WTIC Long-Term Chart
The WTIC 19-year weekly chart, which we first posted last month, strongly states the case for $50 Oil though exact timing of that is uncertain…there is technical support around $60, $50 and then much stronger support in the mid-$30’s which is where Crude may ultimately end up…
Note that the RSI(14) is currently at its most oversold level – just 13% – than at any point over the last 2 decades…the +DI and -DI indicators are also at extremes not seen over the past 20 years…that is really quite astonishing and demonstrates the “paradigm” shift we’ve witnessed in this market over the last few months…
A near-term bounce out of current very oversold conditions could therefore certainly occur, but such an event would likely be followed by new lows given the fact that the Oil bull market has turned into a bear market for an indefinite period…an average WTIC price of $60 a barrel in 2015 is likely optimistic unless OPEC takes drastic actions or major geopolitical events in the Middle East threaten supplies…
Just as high prices led to “demand destruction”, however, an extended period of weak prices will stimulate demand, encourage the world’s long-term addiction to Oil (much to the chagrin of the anti-Oil lobby), and help boost GDP numbers in certain countries…
And as we’ve emphasized, Oil prices at current levels are a huge bonus for Gold producers…
Bellegrade Tosses A Grenade: “Canada Is Indian Land!”
As if resource companies and federal and provincial governments don’t have enough on their hands these days, with radical environmentalists and even an American President who seemingly delights in telling half-truths and outright lies about Keystone XL, along comes Perry Belegrade with these fighting words during a fiery speech to assembly delegates in Winnipeg yesterday as he was elected the new national chief of the Assembly of First Nations…
“To the people across this great land, I say to you, that the values of fairness and tolerance which Canada exports to the world, are a lie when it comes to our people. Canada will no longer develop pipelines, no longer develop transmission lines, or any infrastructure, on our lands as business as usual.
“That is not on.
“We will no longer accept poverty and hopelessness while resource companies and governments grow fat off our lands and territories and resources.
“If our lands and resources are to be developed, it will be done only with our fair share of the royalties, with our ownership of the resources and jobs for our people. It will be done on our terms and our timeline.
“Canada is Indian land. This is my truth and this is the truth of our peoples.”
U.S. Dollar Index Updated Chart
The U.S. Dollar Index is up today but the greenback has been losing RSI(14) momentum recently and also faces formidable long-term technical resistance around the 90 level…Gold bulls seem to be betting on the idea that the Dollar Index rally will stall, temporarily at least, in the 88–90 range after climbing from a low of 79.77 in early July…the Dollar is the King of currencies at the moment, however, and will ultimately take the path of least resistance which is likely a move into the low to mid-90’s in 2015…
Very strong Dollar Index support does exist between 87, the 50-day moving average (SMA), and the Fib. 88 level…
Today’s Equity Markets
Asia
China’s Shanghi Composite had a quieter session overnight but fell 13 points to close at 2927…
China’s top leaders say the country’s economy faces significant downward pressure and that it needs to adjust to the “new normal” of slower but higher-quality growth…in remarks released at the conclusion of a 3-day meeting on economic policy, leaders reiterated that this year’s major targets are within reach…they also pledged to push ahead with market-based revamps and to stick with existing fiscal and monetary policy…the officials also reiterated that they would widen foreign access to the service sector…they didn’t, however, disclose the government’s growth target for next year, a closely watched figure for how Chinese leaders will manage the economy…
More evidence of economic weakness in Japan…the country’s leading gauge of capital spending snapped a 4-month winning streak in October…core machinery orders fell 6.4% on month, worse than expectations for a 2.4% decline in a Reuters poll and slower than September’s 2.9% increase….
Japan’s Nikkei average slipped 155 points to finish at 17257…
Europe
European markets were mixed today…fresh data showed that the uptake of a low-rate loan program by the ECB met market expectations…
North America
The Dow is bouncing back strongly, up 205 points as of 8:20 am Pacific, after yesterday’s sell-off…
U.S. consumer spending advanced at a brisk clip in November as lower gasoline prices gave the holiday shopping season a boost, offering the latest sign of underlying momentum in the economy…the Commerce Department reported this morning that retail sales excluding automobiles, gasoline, building materials and food services, increased 0.6% last month after an unrevised 0.5% rise in October…last month’s increase suggested consumer spending, which accounts for more than two-thirds of U.S. economic activity, was accelerating in the fourth quarter after slowing a bit in the July-September period…
The TSX has recovered 198 points while the Venture is up a point at 669 as of 8:20 am Pacific…
Venture 10-Year Monthly Chart
This long-term chart paints an excellent picture of where the Venture is at in the context of historical trading…
Probably the key takeaway on this chart is that the -DI indicator has almost hit the peak DI level witnessed before at important turning points in the market…coinciding with this is an extreme low %K reading similar to that which appeared at the height of the 2008 Crash…
From the U.S. Dollar’s run to Oil’s plunge to tax-loss selling, a “Perfect Storm” has driven the Venture below its Crash low of 679 but such oversold conditions have probably only increased the likelihood of a rally commencing during the second half of the month, particularly if Gold strengthens further and Oil prices stabilize…
Highbank Resources Ltd. (HBK, TSX-V) Update
One of the best-performing stocks during a turbulent 2014 for the Venture has been Highbank Resources (HBK, TSX-V) which is preparing to commence the production phase for its Swamp Point North aggregate project near Prince Rupert…
As we wrote nearly a week ago, December is a great time to be searching for bargains in this market and a great one came up Tuesday when some nervous nellies sold HBK down to 12 cents intra-day before a powerful reversal took it to a closing price of 17 cents…this confirmed the very strong technical support between the 15 and 19-cent Fib. levels…dumping this stock at 12 cents was a foolish move – too many traders allow emotion to get in the way of common sense…the company has encountered some minor delays in getting to the production stage but this is a well-run company that does know how to execute, and 2015 is shaping up to be a banner year for HBK…
There is no shortage of demand for Highbank’s aggregate – even before anticipated LNG business kicks in – and the company is expected to gradually ramp up production during 2015 once it begins early in the New Year…keep in mind, the port of Prince Rupert is undergoing a massive infrastructure expansion already valued in excess of $40-billion…Highbank holds strategic advantages over any potential competitors, so we see a long-term value-creation situation here that one rarely finds in a Venture company…
Highbank has been a strong Venture out-performer in 2014 and its 200-day moving average (SMA), currently at 22 cents, continues to rise…
HBK is up 2 cents at 20 cents as of 8:20 am Pacific…
Probe Mines Ltd. (PRB, TSX-V)
One of our favorite Gold exploration companies continues to be Probe Mines (PRB, TSX-V) which released important news last night as the company secured 100% ownership of the mineral rights over the entire 70 km strike length of the Borden Gold belt in northern Ontario…
David Palmer, President and CEO of Probe, stated: “Aside from the initial discoveries of the Borden Gold deposit and the HGZ, this acquisition represents the most pivotal milestone in the project’s transition to a development-stage asset. Probe now owns a 100% interest in the entire Borden Gold deposit, including all the claims along the potential southeast strike extension. Our immediate plan is to initiate an infill drill program in the centre of the HGZ over the claim commonly referred to as the ‘wedge’ claim. We anticipate that this will have a significant impact on our current resource estimate through the addition of more high-grade Gold mineralization.”
Technically, John’s PRB chart last Friday showed the emergence of a bullish new trend with the stock trading around the $2.50 level at the time…PRB is up another 19 cents at $2.95 as of 8:20 am Pacific after hitting an intra-day high of $3.16…momentum is clearly back in PRB’s corner…
Note: John, Terry and Jon do not hold share positions in HBK or PRB.
DBV.v Doubleview Capital starts drill program at Hat
2014-12-10 09:21 ET – News Release
Mr. Farshad Shirvani reports
DOUBLEVIEW CAPITAL CORP ANNOUNCES COMMENCEMENT OF DRILLING AT ITS HAT PROPERTY
Doubleview Capital Corp. has commenced a program of diamond drilling at its Hat copper-gold alkalic porphyry property in northwestern British Columbia.
The objectives of this program are:
To explore the Lisle zone at greater depth;
To winterize and make improvements to the camp in preparation for winter drilling;
To re-examine drill cores from early 2013 anomaly A drill holes with reference to additional information gained since the discovery of the Lisle zone (anomaly B).
The first hole of this current Lisle zone drilling program, hole H-23, is collared 111 metres north of hole H-22 and is designed to pass approximately 203 metres vertically below hole H-22. Hole H-22, as previously released, gave the best intersection thus far reported on the Lisle zone: 404 metres of sulphide mineralization that assayed 0.25 per cent copper and 0.255 gram per tonne gold, and included 118 metres with 0.55 per cent copper and 0.41 g/t gold. It is expected that hole H-23 will provide similar results and also will give the company important information about host rock formations and depth continuity of the Lisle zone. That information is essential to the company’s planning of work in 2015.
Doubleview’s exploration of the Hat property has shown that the Lisle zone is drill indicated over a distance of 962 metres and to about 400 metres depth from surface.
Doubleview’s field crew, in addition to processing newly drilled cores, will review and sample selected drill cores from its initial May, 2013, drill program, most of which was directed to the copper-in-soil geochemical and induced polarization chargeability anomaly designated as anomaly A. That work will benefit greatly from the large amount of data and better understanding that have been acquired subsequent to that drilling.
The company plans to continue drilling for the next few weeks. Drill cores will be logged and sampled on-site and samples will be forwarded to an independent fully accredited analytical laboratory for multielement analyses. Analytical details will be provided in a further news release immediately after their receipt and verification.
Doubleview management believes that the Hat property represents an important mineral discovery and the company has invested in numerous camp improvements. Freighting using fixed-wing aircraft and a large-capacity helicopter has enabled the company to place a supply of fuels, lumber and drilling muds on-site.
A vertical section that illustrates hole H-22 and the profile of hole H-23 (in progress) may be viewed on the company’s website. This drawing will be updated periodically.
We seek Safe Harbor.
© 2014 Canjex Publishing Ltd. All rights reserved.
Comment by zippy — December 11, 2014 @ 9:21 am
Hey folks, I posted this two days ago. TLT up 8 cents again today on 1.5 million shares
9.I have significant number of shares in GGI and hoping for a major hit at Rodadero. I also hold quite a few shares in a company I mentioned here before. TLT.V NR today from Theralase that the University of Toledo mirrored the Princess Cancer results Theralase’s PDC on the the treatment of cancer with Rat results before end of year. Breakout today with a fuse that has just been lit that will explode very soon IMO.
Comment by Dan — December 9, 2014 @ 7:24 pm
Comment by Dan — December 11, 2014 @ 2:04 pm
You guy should start a website “bear market run”, just tout everything as a short,
Would have been right that way 😛
Comment by Anonymous001 — December 11, 2014 @ 2:34 pm
GGI – I know the immediate focus is on the discovery north of Silver Eagle where the drilling of two holes should be completed already – hopefully some pics at this location soon. But, what about Tarichi? There were 8 planned holes there long before the discovery north of Silver Eagle – no news since that announcemet, but is the drilling dependent on the PP which hasn’t yet closed?
Comment by Dan — December 11, 2014 @ 4:48 pm
Hi Dan, there are 11 targets at Rodadero North so this is going to be an ongoing effort with Silver Eagle and Tarichi as the first drilled areas. I think they were pleasantly surprised by the discovery north of SE-14-01, so I’m guessing there could be some added attention there. I spoke with Steve today and they’re extremely pleased with how things are going on all fronts, Rodadero, La Patilla, the B.C. projects, and the financing, and he suggested there will be updates (plural) before Christmas, so it sounds like Santa is going to be very generous and will fill our stockings nicely…as far as the overall market is concerned, you know how the mood changed so dramatically last year immediately before Christmas…I believe we’ll see an important turn again this year, consistent with just about every other December we’ve seen…
Comment by Jon - BMR — December 11, 2014 @ 5:25 pm
Last day of the potential ” reversal ” week. My guess is we continue down until Dec 24th and oil stabilizes’.
Comment by tony t — December 12, 2014 @ 4:42 am
Tony, the average date for the Venture Dec. low is Dec. 12, today. The earliest has been Dec. 1, the latest has been Dec. 24. The last 3 years, it has been Dec. 15, 13 and 19. So we’re close. Would be nice to see some even better bargains next week, if they should appear. Oil hasn’t found a low yet but Gold is certainly looking very good, holding above $1,200. Hopefully it can strengthen by the end of the day and finish the week above $1,220.
Comment by Jon - BMR — December 12, 2014 @ 4:53 am
thanks Jon. Hope the bleeding/pain ends soon.
Comment by Tony T — December 12, 2014 @ 6:36 am
GoDaddy is having technical problems across a broad spectrum of their servers this morning; we apologize for any inconvenience in accessing the site, they are working on fixing the problems…and we are working on finding a potential new host.
Comment by BMR — December 12, 2014 @ 9:35 am