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Gold has traded between $1,178 and $1,190 so far today…as of 9:30 am Pacific, bullion is down $8 an ounce at $1,183…Silver is off 18 cents at $16.31…Copper is steady at $2.90…Crude Oil is down by more than $1 a barrel to $59.67 while the U.S. Dollar Index has added half a point to 94.63…

The 25th edition of the Silver Institute’s World Silver Survey, compiled independently by the GFMS team at Thomson Reuters, was released yesterday…key components of global Silver demand rose in 2014, highlighted by jewelry demand which posted a new record last year…there was also notable growth in some key Silver industrial end uses including ethylene oxide, photovoltaics, and brazing and alloys…gains in supply from mine production and producer hedging were partially offset by a continued decline in scrap supply…

Total Silver physical demand stood at 1.07 billion ounces last year, the 4th highest level recorded since 1990, but a 4% decline from the 2013 total…a main factor in the decrease in physical demand was a fall in coin and bar demand from 2013, which had been a record year…

Silver mine production grew by 5% to reach 877.5 million ounces…this growth is attributable to stronger output from the primary Silver and Copper sectors, new projects that came online last year and significant production gains in Central and South America…primary Silver mine production grew 8% and accounted for 31% of global Silver mine supply…Mexico was the world’s leading Silver producer in 2014, followed by Peru, China, Australia and Chile…primary Silver mine cash costs dropped 16% to $7.74 U.S. an ounce…

More Political Upheaval

If you thought Alberta now has problems with a socialist majority government – wing-nut environmentalists, union reps and university students entrusted with overseeing an economic engine powered by 173 billion barrels of Oil – take a look at what’s unfolding in Britain as a separatist party is set to gain a strong foothold in Westminster as Conservative Prime Minister David Cameron aims for re-election in a possible tight battle with the Labour Party…

Just months after its devastating loss in an independence referendum, the Scottish National Party (SNP) quadrupled its membership and could win every single one of the 59 Scottish seats available in today’s national elections…the thought of so many separatists (they are also social democrats in the European tradition) sitting in Westminster – a scenario Canada of course knows well after years of the Bloc Quebecois in Ottawa – is alien in Great Britain and has alarmed many outside Scotland…SNP leader Nicola Sturgeon could be an unlikely election rock star after today’s votes are counted…

CRB Index Updated Chart

The technical evidence is compelling that the CRB Index is in the early stages of a major turnaround, and that’s good news for the Venture looking out over the next several months…we expect the RSI(14) to gradually follow its uptrend line through the 2nd and 3rd quarters, and that will mean a test of Fib. resistance clustered between about 250 and 272…the CRB closed at 230 yesterday, 11% above what may very well have been a cyclical low established in March…

The CRB’s immediate challenge is to overcome the downtrend line indicated below, which also coincides with chart resistance at 230…how soon this breakout may occur is impossible to predict…a minor pullback from current levels, and some consolidation, could certainly occur first…

A successful push above 230 in the CRB would likely be matched by a breakout in the Venture through critical resistance at 707, so the CRB needs to be watched closely…the key takeaway here is that the CRB is in a bullish overall trend at the moment, one that appears sustainable with increasing momentum through the summer…

The CRB is off 2 points at 228 as of 9:30 am Pacific…

Today’s Equity Markets

Asia

China’s Shanghai Composite extended its pullback overnight, falling another 116 points to close at 4113…

Europe

European markets were mixed today…Reuters reported that European lenders dashed any hopes of an aid-for-reform deal next Monday when euro zone finance ministers are scheduled to meet…

North America

The Dow is up 114 points as of 9:30 am Pacific…in Toronto, the TSX has gained 57 points through the first 3 hours of trading while the Venture, after touching its rising 100-day SMA yesterday, remains flat at 687…

Fairmont Resources Inc. (FMR, TSX-V) Update 

There are few companies on the Venture with any hope of ever generating cash flow and building a sustainable, profitable business, but one with immediate and exciting prospects in that regard is Fairmont Resources (FMR, TSX-V) which is effectively harnessing the power of high-grade industrial minerals in logistically strategic areas of Quebec, surrounded by all the necessary infrastructure…what’s even better is that this is a company with a tight capital structure (less than 20 million shares outstanding) led by a President and CEO who has skillfully taken a project from the acquisition stage to full permitting (Certificate of Authorization) in Quebec in less than 12 months – no small feat by any standards, even for a quarry operation…other properties in the company’s pipeline, including some potential high-purity quartz plays that could dazzle investors, can be advanced quickly as well…

We started following Fairmont in January, and the fact that the share price has backed off somewhat since then has made us even more excited about this opportunity as the company continues to execute on its game plan…the general market will catch on to what’s evolving here soon enough…

We’ll have more in a separate piece on FMR later today, but below is a quick review as well as an updated chart from John that confirms technically why this is such a bargain at 10 cents (market cap under $2 million)…

Fairmont’s flagship Buttercup Property near Chicoutimi features high-grade titano-magnetite which has multiple potential commercial applications as dense aggregate…the high, consistent density of this aggregate (4.5 to 4.6) is what makes its special – along of course with the deposit’s location (30 km north of the Port of Saguenay) and its easy access…the local community is fully behind the project and the company has received its CA from Quebec authorities, allowing for up to 300,000 tonnes of aggregate production annually from the property…

The key now, of course, is to line up sales contracts for Buttercup, and interest has been high since the company announced the property was permitted, according to President and CEO Michael Dehn who learned about the value of industrial minerals while serving 12 years at Goldcorp (G, TSX) under the leadership of Rob McEwen…

Readers should note that Fairmont is in discussions with a large private Canadian industrial minerals company as announced early last month…this is a company with annual sales in excess of 1.5 million tonnes of bulk handled industrial minerals with global customers…its initial interest in the Buttercup (they are currently testing material from the property) is for the dense aggregate for customers producing concrete-coated pipelines…the excellent potential for Fairmont to build partnerships like this is an example of how we see FMR growing and building shareholder value in the process…

Technically, some very encouraging signs here…FMR recently hit support at the bottom of a bullish downsloping channel, while RSI(14) is beginning to turn higher after touching long-term support…buy pressure (CMF) has also actually picked up since February, so it appears “smart money” was accumulating with the pullback in the share price…it’s reasonable to expect the top of the downsloping channel to be tested in the near future…

Eskay Mining Corp. (ESK, TSX-V) Update 

The intense accumulation in Eskay Mining (ESK, TSX-V) since the summer of 2013 has been quite amazing given the state of the markets, and there’s every reason to believe there has to be something significant in the works here, especially given an almost total absence of news…

Eskay controls 40 sq. km surrounding the prolific past producing Eskay Creek mine, and they have some giant neighbors – Pretium Resources (PVG, TSX) and Seabridge Gold (SEA, TSX)…while it was in operation, Eskay Creek was the second richest deposit in North America and the 5th largest Silver producer in the world…

We can’t help but think there are some bigger companies looking at ESK’s land package for a potential deal…

Technically, a confirmed breakout above Fib. resistance at 15 cents would be significant…very strong support around 11 cents…

ESK is up 1.5 cents at 11.5 cents as of 9:30 am Pacific…

Castle Mountain Mining Company Ltd. (CMM, TSX-V) Update

Non-resource issues have drawn the most attention of Venture investors recently, but one of the shining lights in the exploration sector has been Castle Mountain Mining (CMM, TSX-V) which is up by about 50% for the year…the market responded well to the recent news of the appointment of Dr. David Adamson as CEO to replace Fraser Buchan, while Castle Mountain also recruited Ian Cunningham-Dunlop as Vice-President, Exploration…this certainly strengthens the management team…

We alerted our readers to CMM on the morning of January 19 when the company reported some impressive high-grade drill results from its advanced Castle Mountain Project in southern California…CMM took off from the upper 30’s and climbed as high as 55 cents that day – the 200-day SMA at the time – before consolidating at slightly lower levels…

Results are pending from a follow-up drill program…concurrent with the announcement of management and board changes last month, CMM also completed a $2 million financing at 35 cents…

Technically, CMM is finally gaining traction about its 200-day SMA which has flattened out at 44 cents…key resistance remains at the previously identified 59-cent Fib. level on this 2-year weekly chart…

CMM is off half a penny at 48.5 cents as of 9:30 am Pacific…

Note:  Jon holds a share position in FMR.