Gold is bouncing back after yesterday’s sharp drop…as of 9:00 am Pacific, the yellow metal is up $42 an ounce at $1,859…Silver has gained 94 cents to $42.49, Copper is up 2 pennies to $4.15, Crude Oil is ahead 61 cents at $89.95 while the U.S. Dollar Index has gained half a point and is now at resistance at 76.00…what was impressive yesterday was how well the Gold stocks held up as the metal dropped below $1,800 intra-day…the TSX Gold Index was down as much as 15 points yesterday but recovered all of its losses while the Venture Exchange erased a minor intra-day 8-point loss…reports from Tripoli this morning stated that Libya’s central bank sold 29 tons of Gold in the spring so Moammar Gadhafi could pay salaries…that’s about $1.4-billion U.S. and about 20% of Libya’s Gold reserves, according to Reuters and The Associated Press…Qassim Azzuz, Libya’s new central bank chief, said the regime sold the bullion to Libyan traders during the uprising that toppled the government…
Advanced economies will barely grow in the second half of this year, the OECD (Organization for Economic Co-Operation and Development) predicted today in a significant downward revision to its previous forecasts…presenting updated growth estimates for rich-world countries, Pier Carlo Padoan, the OECD’s chief economist, said that quarterly growth in the second half of 2011 would average less than 0.2% a quarter, an annualized rate below 1%…in its May Economic Outlook, the organization thought second half G7 growth would average just over 0.5%…the Paris-based international organization revised its previous view in favor of interest rate hikes and recommended that central banks should loosen monetary policy further if “signs emerge of the weakness enduring or the economy risks relapsing in recession”…
The Canadian economy is projected to grow at an annualized pace of 1% in the current quarter and 1.9% in the final three months…that compares to 0.4% in the United States, no growth in Japan, 0.4% in France, 0.1% in Italy and 0.3% in Britain…Germany’s economy is projected to contract by 1.4% in the fourth quarter…the outlook for Germany is particularly ominous given that it’s Europe’s biggest economy and has been the major player in the bailouts of its weaker neighbors…
German Finance Minister Wolfgang Schaeuble said today that the situation in Greece was “serious” and the country would not receive new aid until it met the fiscal conditions set out for it by its international lenders…”Ladies and gentlemen, the situation is serious in Greece,” Schaeuble said in a speech in the Bundestag lower house of parliament…”At the moment the troika mission is suspended…there can be no illusions here…as long as this mission cannot confirm that Greece has fulfilled the conditions, then the next aid tranche cannot be paid…there is no wiggle room here”…
U.S. jobless claims rose slightly last week with the less volatile four-week average increasing for the third straight week to 414,750…President Obama delivers a much-anticipated jobs speech to Congress this evening but unfortunately he’s a couple of years late…Obama lacks credibility on the economic front or a bold plan encompassing broad-based tax and regulatory reform that would create a healthier environment for the private sector to do what it can do far better than government ever could – create jobs and wealth…
A survey by the Canadian Payroll Association on the financial health of the country’s workers has found that a majority of Canadian employees are living paycheck to paycheck and would be in financial difficulty if their pay were delayed by even a week…the article was in this morning’s Globe and Mail…the survey also found that 40% of Canadians now report they expect to retire later than they had previously planned, acknowledging they are not saving enough for retirement…the main reason for low savings is that most workers are living “close to the line”, the CPA concluded, with 57% reporting they would be in difficulty if their pay were delayed by even a week…that number jumps to 63% for workers aged 18 to 34 and to 74% for single parents…
The CDNX is up 9 points to 1800 as of 9:00 am Pacific…news flow in this market has picked up significantly today and we’re looking into numerous situations…Spanish Mountain Gold (SPA, TSX-V) was the volume leader in very early trading this morning…SPA has a strong chart (see John’s analysis in Tuesday’s Morning Musings) and a promising Gold deposit (low-grade but high tonnage) in central British Columbia…a respected group is also at the helm of this company, so we believe its prospects are very well – particularly given our view that Gold will push past $2,000 an ounce during the fourth quarter…SPA is currently up a nickel at 85 cents on CDNX volume of 1.5 million shares…
Visible Gold Mines (VGD, TSX-V) enjoyed a powerful day yesterday, climbing through resistance in the upper 30’s on strong volume and closing at 40.5 cents…it’s off 2 pennies through the first two-and-a-half hours of trading this morning but any weakness should be embraced given how bullish the technicals and fundamentals are at the moment…it’s important to emphasize that VGD’s 100-day moving average (SMA), which has been in decline since February, is now beginning to reverse to the upside – just another indication that VGD has really turned the corner…consider it to be technical confirmation that the fundamentals with this company have changed significantly for the better (Wasamac area, Joutel)…the Fibonacci level of 51 cents that John shows is not a price target, as we don’t give price targets at BMR, but merely a theoretical point at which the share price could pause or react over the near-term based on technical analysis…ultimately, VGD could head much higher than 51 cents but where the share price goes of course will depend entirely on exploration news and drill results…the white candle that John refers to in the chart below requires confirmation either today or tomorrow…
Adventure Gold (AGE, TSX-V) has an impressive chart at the moment as well…volume has picked up considerably in AGE and the stock gained 4 pennies yesterday to close at 55 cents…it’s currently unchanged at 55 cents after touching 57 cents this morning…we’re very bullish on the company’s Pascalis-Colombiere Gold Property near Val-d’Or and initial drill results from the Phase 2 program that started in late May are pending…Pascalis is an intriguing property that includes the former producing L.C. Beliveau Mine, and we’ll be reviewing Pascalis in detail during our upcoming visit to northwest Quebec beginning early next week…we posted a chart on AGE just the other day but John saw some significant technical developments yesterday, so below is an updated version…
Currie Rose Resources (CUI, TSX-V) is up a penny at 19.5 cents…Trueclaim Exploration (TRM, TSX-V) came out with a positive update on the Scadding Property this morning, including new drill results, but the value-drivers for CUI at the moment are the Sekenke and Mabale Hills Projects in Tanzania…drilling is underway at Sekenke, a large land package with outstanding potential, while drill results are pending from the Sisu River and Dhahabu properties at Mabale…core visuals were highly encouraging as the company reported August 24…Wildcat Silver (WS, TSX) continues to be a play to keep a close eye on…the company released solid results this morning for 8 additional holes completed at the Hermosa Property in Arizona…an update to the existing resource and preliminary economic assessment is expected to be released sometime during the fourth quarter…WS got as high as $1.87 (its 50-day SMA) following the news but is now unchanged for the day at $1.78…the rising 200-day SMA just above $1.50 is the supporting moving average…a company we’re intrigued about that we’re continuing to explore in more detail is Cascadero Copper (CCD, TSX-V)…we suggest our readers check it out…CCD has a lot on the go including a significant presence in Argentina with some highly prospective ground there…CCD is currently up a penny at 18.5 cents…we’ll have more on CCD by next week…
Anyone following small production outfits who will probably be taken over in the coming consolidation.? One I like a lot at the moment is NWM Mining NWM which is increasing production and will increase its resource with this funding. Looks like a definite candidate for a takeover with a lot of big producers nearby in Mexico looking for an easy add on to increase their numbers. Should be a simple enough double from its present 15-16c range in a few months. Another one is Rochester Resources RCT. This is very promising but its very hard to get up to date details on production as they only release yearly results and are very silent as regards NR’s. Still at 4-5c for a producer at these gold prices its interesting. Also those yearly results are due sometime this month so could be very interesting. Nice to have a few low price producers to go along with the exploration stocks. Would welcome any other suggestions in this type of price range.
Comment by Patrick — September 8, 2011 @ 9:14 am
Come on people a close above 15.5 cents for CQX would be very bullish going into next week. We can do it 🙂
Comment by Ed — September 8, 2011 @ 10:14 am
According to TD Waterhouse technical analysis, CQX formed a long term bullish Symmetrical Continuation Triangle on September 1. Price Target is: 0.23-0.25c. MACD is pointing upwards and we have also crossed our 21 and 50 day moving averages. All bullish signs of a reversal.
On Sept 7, VGD formed a bullish intermediate term bottom triangle. Price Target of 0.52-0.54 which would agree with BMR’s Fibbonacci target. VGD also closed above its 200 day average which is long term bullish.
These two stock should track eachother going forward. At current levels, CQX is cheaper than VGD in relative terms.
Comment by Andrew M — September 8, 2011 @ 10:58 am
Interesting, thanks Andrew, my only concern would be with TA on CQX as the volume is often minimal and also the number of trades?
Comment by Andrew — September 8, 2011 @ 11:11 am
Thanks Andrews, So what you guys are saying is that a close above 15.5 cents for CQX would be super duper bullish for Andrew M , however for just Andrew he’s not so much bullish on CQX. So there you have it folks one out of every two Andrews is bullish on CQX. :).
Comment by Ed — September 8, 2011 @ 11:18 am
I think even though volume maybe considered low on CQX you have to understand that there aren’t very many outstanding shares for the company. So what you would normally consider low for most stocks maybe be high for CQX. In my opinion volume over 100k shares traded is considered above average for this stock and over the course of the past month you have seen the volumes pick up to above average levels.
At current levels, CQX is reaching resistance so confirmation of a breakout would occur with volumes traded above 100k. Next level of resistance is around 0.21c.
Right now, I think the stock is forming a cup and handle, so we’ll have to wait and see if we get a confirmed breakout from the handle, but I don’t see why not since VGD is rallying.
Comment by Andrew M — September 8, 2011 @ 11:48 am
Yes, I think it will follow VGD to a degree, Andrew. I hope so, I’m a shareholder too! Maybe John will update the CQX chart once it gets some momentum? There were only 5 trades on the Venture exchange today and one of those was for 70% of the total volume – that just makes it difficult to use stats. VGD closed at .405 so that’s nice! Have a good one.
Comment by Andrew — September 8, 2011 @ 12:02 pm
GBB finally slided down to 35.5 cents (-2.5 cents) and it is best time to collect additional holdings. Thanks for dumping and this can be the final chance to scoop more at this price. GDX lost another cent with heavy trading and this should be the bottom line before it goes back up. My sixth sense move is still there. BER got another 1.5 cents and closed at 23 cents. Low volume and at least, no one is dumping at this stage and it has really potential to move up again when volume kicks in – my sixth sense stock. MTU got 11 cents and closed at 50 cents… yesterday’s close at 39 cents was too low. TYP lost two cents and closed at 79 cents… and buying point 75 cents will be in sight… NAR closed at 17 cents with no changes. CQX and VGD performed well today and may challenge next resistance point…. 19 cents and 46 cents respectively.
Comment by Theodore — September 8, 2011 @ 12:53 pm
Andrew and Andrew M.
When a stock has low daily volume I suggest you switch to the weekly chart. Which pattern for CQX do you see?
Comment by John - BMR — September 8, 2011 @ 2:13 pm
Revising Smartstox interview,
Lost gold value at joutel,
Hi Jon,
Hope you are doing good,
Knows already we are not geologist, but how would you compare Cadillac fault with the one crossing joutel for 25 km in lenght?
Martin
Comment by Martin — September 8, 2011 @ 4:04 pm
Thank Martin 🙂
Comment by Martin — September 8, 2011 @ 4:05 pm
Martin
what do you mean by lost gold value at joutel?
thx
Comment by GREG — September 8, 2011 @ 4:25 pm
Interesting blog by “Trader Dan” on how the HUI is finally breaking away from being ties to the broader market moves. traderdannorcini.blogspot.com/. Sept has finally arrived and with the gold price high, even poor economic news will not stop some gowth in the miners.
Comment by Scotty C — September 8, 2011 @ 5:08 pm
Good question, Martin. When they talk of a “lost gold value”, I think that’s Sansfacon’s way of describing a situation where a good assay result was actually “lost” from one map to another…..sometimes simple mistakes can be very important….I think that’s what helped Sansfacon make a discovery at Canadian Malartic……as I said, your question is good, and when I’m in Rouyn-Noranda next week I’m going to give this to Sansfacon as a question from one of our readers….how would he compare the Cadillac Fault structure with the system at Joutel………in terms of the Cadillac Fault, it’s certainly a major regional structure…..it has triggered many secondary faults…..north of the Cadillac Fault, you have volcanic rocks….immediately south, on on the other side of the fault, you have sedimentary rocks…..with the volcanic rocks, of course, you have a greater probability of base metal mineralization (plus the possibility for gold of course)……Granada is a classic example – the Cadillac Fault runs through the northern edge of the property……it’s almost entirely a gold environment that GBB is drilling into……Joutel is referred to as the Joutel Volcanic Complex…….I think you have sediments in contact with a volcanic sequence……there’s obviously some sort of structure that appears to strike in a southeasterly direction…..we’re going to explore Joutel in some detail next week so I hope the geologists can expand on your very good question……..
Comment by Jon - BMR — September 8, 2011 @ 5:24 pm
Thank Jon, doing more DD, will get back to you, take care!
Martin
Comment by Martin — September 8, 2011 @ 5:56 pm
Hi Greg,
Have another look at the interview, on their web site. Look at Martin gestual went speaking about wasa and joutel versus silidor, its speaks for itself!
Thanks,
Comment by Martin — September 8, 2011 @ 7:04 pm
I am new to your site and I enjoy it very much. I had Louvem shares for over 20 years, and now they are RIC. It is good to see all this new activity in the Abitibi region. I have just purchased VGD, and the question, is VGD a good long term investment. Does VGD intend to eventually develop a gold producing mine, or will they sell the property at a tidy profir like ER(Eastmain) intends to do. Thank you.
Alexandre
Comment by Alexandre — September 8, 2011 @ 9:38 pm
Hello John, thanks for noticing our comments on CQX. I wish I could answer your question! I use TMX PowerStream advanced charts and if I look at a 5 day or 10 day chart for CQX the results are changed dramatically depending on the interval (1 minute – 1 hour). There could be high selling pressure on one chart or buying pressure on another. At best using a 1 hour interval I could perhaps say that there is an ascending triangle but only over a few days, selling/buying pressure has flattened but due to lack of volume. .155 looks like it is resistance? 100 and 200 day SMA are just starting to rise and the sp is above both. RSI is now turning upwards. %K and %D are turning upwards and %D has crossed through %K and is below it. It’s a bullish chart over 5 days and 10 days but needing volume?
Comment by Andrew — September 9, 2011 @ 4:18 am
Good morning, Andrew. We’re posting a chart on CQX this morning. As I read it (John’s chart), it’s on the cusp of a breakout and I believe it will break out given the patterns we’re seeing with VGD and the bullish fundamentals of the overall Wasamac situation.
Comment by Jon - BMR — September 9, 2011 @ 4:29 am
Hi Alexandre, welcome….it’s always great to have new readers and posters. I don’t believe VGD’s strategy is to become a producer – I believe their strategy is to be taken over by a producer. There’s a lot to like about this company, including their strong geological team (headed by Sansfacon) and of course their properties – in particular their Wasamac-area land package and Joutel. If you’re from the Abitibi area, I’m sure you’re aware of what’s developing at and around Wasamac. VGD is aggressive and they have a strong cash position.
Comment by Jon - BMR — September 9, 2011 @ 4:34 am
Thanks Jon, I’m looking forward to this morning’s report and John’s chart.
Comment by Andrew — September 9, 2011 @ 5:21 am
Bonjour Martin, that is good observation of Martin Dallaire’s body language! You can tell a great deal from reading body language. I once took a short course in reading facial body language – George Bush was easy to read, especially when he wasn’t telling the truth and Oliver North was just about impossible to read! 🙂
Comment by Andrew — September 9, 2011 @ 5:23 am
BMR
Wow
RIC new all time high this morning over 12 bucks, any new fib points to look at next?
Comment by GREG H — September 9, 2011 @ 6:28 am
We’ll do another RIC chart very soon, certainly by Tuesday or so when we begin our northwest Quebec trip…the law of supply and demand is going to come into effect with Wasamac…besides Richmont, the #1 play is VGD at a paltry 40 cents…then there’s CQX at a cheap 14.5 cents…and Globex at $2.30…if you missed RIC, don’t miss the opportunities in those 3 – in particular VGD…the Wasamac deposit is going to make headlines IMHO…
Comment by Jon - BMR — September 9, 2011 @ 7:06 am
looks like start of annual runup in gcq. perhaps a popup before pp. richard
Comment by richard — September 9, 2011 @ 7:08 am
You could be right…it was ridiculously cheap at 13 cents…
Comment by Jon - BMR — September 9, 2011 @ 7:10 am