Gold is under pressure today, falling below both its 50 and 100-day moving averages (SMA’s)…as of 8:40 am Pacific, bullion is down $13 an ounce at $1,291…Silver is off 44 cents at $20.47…as per our 6-month Silver chart Monday, a normal retracement to Fib. support anywhere between $19.50 and $20.33 is a reasonable expectation (nothing to panic about)…Copper has climbed 6 cents to $3.25, its highest level in a week, following encouraging economic data out of China and the euro zone…Crude Oil has slipped 47 cents to $102.65 while the U.S. Dollar Index is up slightly to 80.86…
A slew of large and mid-cap Gold miners are set to release their full financial results next week…it’ll be interesting to see how effective they have been at reducing costs and what average all-in sustaining costs are at right now and where they’re headed…
As John’s 6-month Gold chart showed last weekend, Gold has strong Fib. support in the $1,280’s…geopolitical tensions should help limit any downside moves such as we’re seeing today…
Freeport McMoran Inc. (FCX, NYSE), one of the world’s top Copper producers, yesterday reported net income of $482 million (46 cents per share) during the second quarter of 2014, matching exactly its net income for the same period in 2013 (though net income per share was down from 49 cents)…Freeport says it’s aggressively pursuing increased Copper production in the U.S., specifically Arizona and New Mexico, due to easier labor laws and more reliable environmental and permitting regulations…the centerpiece of expansion efforts in the U.S. is Morenci, a sprawling 65,000-acre complex in the dusty hills of eastern Arizona on the border with New Mexico…an expanded mill started producing in the second quarter and full rates of production are expected by the end of 2014, Freeport said…Morenci is expected to produce almost a billion pounds of copper a year by 2015, making it one of the world’s biggest mines, up from 564 million pounds in 2013…
Today’s Equity Markets
Asia
China’s Shanghai Composite gained an impressive 27 points overnight, extending gains into a fifth day, to close at a three-month high of 2105…China’s manufacturing rose in July to its highest level in 18 months, in a sign that mini-stimulus measures to shore up growth in the world’s second largest economy are taking hold…the preliminary HSBC PMI rose to 52.0 in July from 50.7, the highest reading since January 2013…the report said overall new orders and new export orders in China’s giant manufacturing industry rose faster in July than the month before…all other categories, including employment and output prices, also improved. “The strength of this morning’s data from China and the euro zone offers some encouragement that there is some momentum building for the global economy at the start of the third quarter,” Mark Wall, European economist at Deutsche Bank, told CNBC this morning.
Japan’s Nikkei lost 44 points overnight…
Europe
European markets were up modestly today…a closely watched survey suggests economic growth in the 18-country euro zone picked up during July despite ongoing concerns over France, the currency bloc’s second-largest economy…financial information company Markit said today that its PMI rose to a three-month high of 54.0 in July from 52.8 in June…numbers above 50, of course, indicate expansion…much of the increase was due to ongoing economic strength in Germany, Europe’s largest economy…however, Markit also found businesses in the “periphery” countries outside of Germany and France expanding at their fastest pace since 2007…France was the laggard because of its stagnant services sector…overall, Markit says the euro zone is growing at a 0.4% tick, which equates to an annualized 1.6% rate…
North America
The Dow is up 20 points as of 8:40 am Pacific…first-time weekly jobless claims in the U.S. fell by 19,000 to a seasonally adjusted 284,000 during the week to Saturday, the Labor Department said this morning…that’s the lowest level of intial claims since February, 2006…
Meanwhile, some other economic data wasn’t so positive…sales of new U.S. single-family homes fell sharply in June and the prior month’s data was revised to show less robust growth, suggesting the housing market continues to struggle to regain momentum…the Commerce Department said today that that sales dropped 8.1%, the largest decline since July 2013…
The TSX is up another 21 points while the Venture is off 3 points to 1009…
TSX Updated 5-Year Weekly Chart
The TSX continued its string of record-high closes yesterday, finishing at 15394…this 5-year weekly chart from John shows the impressive upsloping channel the TSX has been in since the summer of last year with the continuously rising 50-day SMA acting as a close supporting moving average…
RSI(14) is currently at 75%, in overbought territory, but could remain O/B for a while yet…it’s following an uptrend line established last year…the question now is, will the TSX break out above the upsloping channel?…a squeeze is also occurring between the top of the channel and the 50-day SMA…
North Arrow Minerals (NAR, TSX-V) Update
North Arrow Minerals (NAR, TSX-V) has a superb management team, a strong balance sheet, and some exciting discovery opportunities in the diamond sector which is why we’ve been excited about this play since it really started to come to life late last year…
Last week, North Arrow announced announced that mobilization was under way for the commencement of a 1,000 m drill program at the Redemption Project in the Northwest Territories…the property is located in the Lac de Gras region, approximately 30 km southwest of, and 50 km west of, the Ekati and Diavik diamond mines, respectively…the drill program is expected to run through to the middle of August…a follow-up winter/spring program will be required to test ice-based targets…
As stated in the news release, the drill targets include various combinations of gravity, magnetic and electromagnetic geophysical responses that have been further prioritized based on their location with respect to the termination of the South Coppermine kimberlite indicator mineral (KIM) train, which represents one of the last well-defined and unsourced KIM trains in the Lac de Gras region…the discovery of even a single kimberlite from any of these top-priority targets would upgrade a number of the remaining prospective targets within the Redemption Project…
Technically, the key level to watch on NAR is the low 80’s – a breakout above this resistance would be significant…as you can see in this 1-year weekly chart, NAR has been trading essentially within a horizontal flag for the past eight months or so…it’s off a nickel at 75 cents as of 8:40 am Pacific…
Arctic Star Development Corp. (ADD, TSX-V)
North Arrow will be drilling Redemption under an option agreement with Arctic Star Development (ADD, TSX-V)…NAR can earn a 55% interest in the project by incurring $5-million in exploration expenditures prior to July 1, 2017…Arctic Star has performed well lately, climbing from a low of 11 cents July 14 to a fresh 52-week high of 19.5 cents yesterday…
ADD has completed the first tranche of a financing (a non-brokered PP for up to $1.3 million)…some of the proceeds are intended for a potential new project in Canada, the company stated…ADD is off a penny at 18.5 cents as of 8:40 am Pacific, but the technicals are quite encouraging – ADD is worthy of being on our readers’ radar screens with new support in the mid-teens…below is a 2-year weekly chart…as always, perform your own due diligence…
North American Nickel Inc. (NAN, TSX-V) Update
Not surprisingly, given some overbought technical conditions that emerged in late June as John pointed out, North American Nickel (NAN, TSX-V) has backed off from its all-time high of 65 cents to a support band between 45 and 50 cents…NAN started drilling its very promising 100%-owned Maniitsoq Nickel-Copper-PGE sulphide project in southwest Greenland in mid-June…
Technically, for the near-term at least, it’ll be important for NAN to hold support at the 45-cent level…somewhat disconcerting is the fact that NAN has broken below its 50-day SMA for the first time this year, and the 20-day has ended a months-long bullish pattern by reversing to the downside…what we’re witnessing now appears to be a healthy correction within a primary “big picture” uptrend…the long-term SMA’s (100, 200, 300) continue to rise…
This 2.5-year weekly chart shows the RSI(14) has unwound to 56%…chart and Fib. support levels are outlined…NAN closed at 47 cents yesterday and has yet to trade today as of 8:40 am Pacific…
Note: John, Terry and Jon do not hold share positions in NAR, ADD or NAN.
Would you guys at BMR please buy some more GBB so that you can start to pump it daily like the good old days. If one of your current darlings was performing like GBB is right now, you would be rabidly pounding your fists on the table. It’s not too late, hit the ask at .065 and lets get this party started.
Comment by mike — July 24, 2014 @ 8:23 am
lol. Mike, we gave a good overview of GBB technically a short while ago and of course we still love the project and its potential. Obviously share structure is an issue now in a way that it wasn’t back in 2010 and most of 2011, due to a lot of cheap FT financings. So this has to do a lot of volume to get cleaned up, but it has broken above a long-term downtrend and that’s encouraging.
Comment by Jon - BMR — July 24, 2014 @ 8:37 am
Wondering if you guys believe all that talk about gold and silver manipulation? I find it hard not to when you read about billions of dollars in futures being dumped in seconds…
Comment by Mark — July 24, 2014 @ 9:03 am
PGX have not yet received assays results from the lab and expect to release results mid-august.
Comment by Robert — July 24, 2014 @ 10:23 am