Gold has traded between a high of $1,284 and support in the low $1,260’s so far today…as of 8:00 am Pacific, bullion is down $19 an ounce at $1,264 following yesterday’s Fed policy statement…a corrective pullback such as this is not unexpected given bullion’s sharp rise this month…Silver is off 79 cents at $17.17…Copper is down a penny at $2.48…Crude Oil has retreated 45 cents to $44.00…Crude inventories in the U.S. expanded by 8.87 million barrels to 406.7 million last week, the EIA reported yesterday…in a sign of the times, Royal Dutch Shell Plc said it will cut $15 billion of spending over the next 3 years as Big Oil digs in for what is likely to be an extended period of depressed prices…the U.S. Dollar Index is off nearly one-fifth of a point at 94.48 as of 8:00 am Pacific…
Latest USGS figures show that production of Gold by U.S. mines was 540,000 ounces (16.8 tonnes) in October, a 6% decrease compared with September output and an 11% decrease compared with that of October 2013…year-on-year U.S. Gold output is down by 7.4%, continuing the decline seen a year earlier…the U.S. is the world’s 4th largest Gold producer after China, Australia and Russia…
The currency wars continue…New Zealand’s Reserve Bank has kept policy unchanged, but significantly altered its language today, saying it expects to see a “further significant depreciation” for the kiwi and that “the exchange rate remains unjustified in terms of current economic conditions.”Ā That’s about as direct as a central bank can get in “talking down” its currency in order to stimulate economic growth…
The Federal Reserve is in a “wait-and-see” mode, signalling yesterday that it will keep short-term interest rates near zero until at least mid-year…the next Fed meeting (March 17-18) will be key – that’s when officials will update their forecasts for economic output, inflation, unemployment and interest rates, so we should know by then (if not sooner depending on U.S. and global economic data over the next 6 weeks) if the Fed plans on implementing its first rate increase in nearly 10 years by June, or if a rate hike is off the table until at least later in the year…
The Fed remained upbeat about the U.S. economy, noting its āsolidā growth and āstrong job gains”…however, some interesting new language was included in yesterday’s statement (a subtle note of caution) – the Fed said it would be watching āinternational developmentsā as it considers its next step…if instability on the global economic front intensifies, which is very possible, the Fed may indeed have no choice but to keep rates at record lows for longer than currently anticipated…
Gold-U.S. Dollar 34-Year Comparative Chart
Historically, Gold and the U.S. dollar have had an inverse relationship – when 1 has done well, the other has been weak…recently, the 2 have been moving in tandem – in fact, as strong as the greenback has been over the last 3 months, bullion has actually performed better…right now, and perhaps for the foreseeable future, Gold and the greenback are the 2 currencies of choice among international traders and investors given the increasingly unstable world in which we live…so we’re not as concerned now as we were several months ago about a rising U.S. dollar negatively impacting bullion…
Going back more than 3 decades, Gold is the clear winner actually in terms of its performance vs. any currency including the greenback…
As you can see in this 34-year monthly chart, Gold is up 82% over that time vs. a 4.8% decline in the U.S. Dollar Index…the Dollar Index is currently at a more than 10-year high but is also approaching a long-term downtrend line in the high 90’s…
CRB Index Updated Chart
This 10-year monthly CRB chart paints a continuing bearish picture for commodities in general, though Gold appears to have decoupled from this Index…
Based on its current technical posture, there’s every reason to believe that the CRB Index – at the very least – will test the bottom of the support band between 200 and 220…so it does have further to go on the downside, likely led by Crude Oil…there’s an eery comparison between the current plunge and the 2008 collapse…in a way this is good, as the CRB needs to find a bottom…expect RSI(14) conditions to move further into oversold territory…
Canadian Dollar Update
The loonie has fallen below 80 cents U.S. for the first time since April 2009…like Oil and the CRB Index, the loonie has further to go on the downside, based on fundamental and technical factors, before it finally bottoms…the level we’re targeting is the low 70’s…
Keep in mind that the plunge in both the loonie and Oil is highly bullish for Canadian Gold producers, which is a theme we have been stressing for the last few months…Gold in Canadian dollar terms has really taken off to the upside and should remain comfortably above many companies’ forecasts, while multi-year lows in Oil will benefit open-pit producers the most…
An important support band for the loonie exists between 78 and 80 cents…that area held during the 2008-2009 financial crisis, but everything is relative and the U.S. dollar is in a stronger trend now than it was back then…expect the loonie to breach its 78-80 cent support level during this first half of 2015…
Today’s Equity Markets
Asia
Asian indices were broadly lower overnight, led by a 1.3% decline in China’s Shanghai Composite…the drop in Oil and some disappointing corporate earnings were the culprits…Japan’s Nikkei average slipped 190 points…
Europe
European markets were mixed today…
North America
The Dow is off 4 points as of 8:00 am Pacific…the Index is likely headed for a negative month overall as it’s currently down 3.5% for January…disappointing earnings growth has been a contributing factor in the weakness…
The TSXĀ has lost 158 points while the Venture is down 3 points at 664…as we highlighted in a chart last weekend, the Venture may have to test support in the low 650’s before reversing higher again – so the current pullback is opening some opportunities…
Cannabix Technologies Inc. (CXB, CSE-V) Update
The overall trading pattern in Cannabix Technologies (BLO, CSE) since November remains highly encouraging as shown in this 4-month daily chart (note that this chart is in U.S. dollars – based on BLO’s OTC listing – as Stockcharts.com does not yet provide charts for CSE listings)…
For the first time since it was launched in June of last year, Cannabix has been forming an exceptionally solid base and has been rising very gradually in step with its 20-day supporting moving average currently at 13 cents U.S. (or just above 15 cents CDN)…not shown on the chart below is the 100-day SMA which has just reversed to the upside, another bullish development…
Volume also remains impressive…over the last 10 trading sessions, a total of 3.6 million Cannabix shares have changed hands in the 2 markets (CSE and OTC) with an average of 200,000 per day in Canada and 160,000 per day stateside…we expect U.S. interest in this story to build significantly as the year progresses, especially after the company’s marijuana breathalyzer prototype is unveiled (likely anytime this quarter)…
BLO is up half a penny at 17 cents on the CSE as of 8:00 am Pacific, and up slightly at 13.5 cents on the OTC…
North Arrow Minerals (NAR, TSX-V) Update
One of our astute readers made some good points regarding North Arrow Minerals (NAR, TSX-V) in our comments section earlier this week, and below is some additional information concerning both the technicals and the fundamentals…
North Arrow this month has broken above a downtrend line going back to last summer…in addition, the 50-day moving average (SMA) has now reversed to the upside, accumulation has replaced sell pressure as shown by the CMF, and RSI(14) is climbing an uptrend with plenty of room to still push higher at 58%…
Last week, North Arrow reported that results from a 1,500-tonne bulk sample from its important Q1–4 kimberlite at the Qilalugaq Project in Nunavut are expected in April (the 12.5 hectare Q1–4 kimberlite is the largest diamondiferous kimberlite pipe in the eastern Canadian Arctic and 1 of 8 kimberlite pipes identified within the Qilalugaq Diamond Project…Q1–4 includes inferred resources as well as extremely rare yellow diamonds found in a sampling program)ā¦
North Arrow is also gearing up for a drill program at its Pikoo Project in Saskatchewan which has delivered very promising early results…
With President and CEO Ken Armstrong, and Chairman Gren Thomas, among others, NAR features a highly respected management group and board responsible for the discovery of many kimberlites in Canada and Africa, including of course the Diavik mine in the Northwest Territoriesā¦
NAR closed at 55 cents yesterday which should be new support at the top of a horizontal channel…
Note:Ā John and Jon both hold share positions in BLO.
ok folks,lets just guess that it was ggi that was visited,and that someone suggested a ds.was signed,”if” that was the case, then they must have liked what they seen,because as of yesterday bmr still claim they hold positions in ggi.encourged and still hold.just my opinion/guess.
Comment by tombc — January 29, 2015 @ 8:37 am
BMR – Keep in mind that the plunge in both the loonie and Oil is highly bullish for Canadian
Gold producers,
Bert – Maybe so, but to take an opposite view, Gold also depends a lot on other factors,
take for example, Gold is down $27.00 today, could that be because of the U.S. Fed’s
statement that the U.S. economy is doing well & they are on track to raise interest
rates soon & Gold not being interest bearing, so it tanks. Could the future of Gold
be that rosy, realizing trader’s expectations & of course, as Gold goes so do the
producers.
Comment by Bert — January 29, 2015 @ 8:52 am
Tombc
You asked me to guess & my answer is no. their trip had something
to do with snow so forget Mexico.
Comment by Bert — January 29, 2015 @ 8:54 am
Sold my last remaining precious metals stock this morning. I don’t see the situation correcting for quite some time. If conventional markets start tanking, it will drag gold and silver with it. I’m thinking I’ll be back once they formally announce QE4. For now I’ll stick to some trading and the medical marijuana field. Best of luck to those who continue to hold precious metals stocks. I wish you all the best and I hope it turns out good for you guys.
Comment by chris — January 29, 2015 @ 9:23 am
maybe grizzly then? ha,doesn’t matter much at this point,next couple of weeks should be very interesting i must say.
Comment by tombc — January 29, 2015 @ 10:51 am
gcu.v on. the move. merrill lynch buying big.a little green in a sea of red today
Comment by kc — January 29, 2015 @ 11:29 am
When will it end? or will it ever end, Im talking about the illegal shorting of the gold and silver on the Comex and now in the GLD and SLV as well, the Fed’s puppets, primarily JPMorgan totally and illegally control the price of gold and silver, there is no free market in these metals, so I must be a total idiot to invest my money in this type of market that has no chance of winning in the long run, fed up.
From Ted Butler:
Shorting shares in a hard metal ETF, like SLV, instead of securing and depositing actual metal, is cheating in its purest form, a Wall Street end around gimmick that hurts all silver investors, not just those in SLV. As such, silver (and gold) investors should be united against it. How does it hurt all silver investors and not just SLV investors? By not having to bid up silver prices by securing metal when it is not freely available, the free market forces of supply and demand are circumvented to the short sellersā advantage and to all silver investorsā detriment. This is the reason shares are shorted ā so actual metal prices can be kept low.
Iām not suggesting that the shorting of SLV shares is at the heart of the silver manipulation, as Manipulation Central is still firmly ensconced on the COMEX. After all, the eight big shorts on the COMEX are short 310 million oz, while total SLV shorts are in the 20 million oz range. But the shorting of SLV shares is an important additional means of control for crooks like JPMorgan and a way to short circuit free market supply and demand. – Silver analyst Ted Butler: 28 January 2015
Comment by Greg — January 29, 2015 @ 12:53 pm
Despite the drop in gold and silver, is it safe to say the majors and the venture held up well,with all the profit takeing today.
Comment by Tombc — January 29, 2015 @ 1:29 pm
Despite the drop in gold and silver, is it safe to say the majors and the venture held up well, despite what I see as purely profit takeing today.
Comment by Tombc — January 29, 2015 @ 1:32 pm
Ooop’s sorry.
Comment by Tombc — January 29, 2015 @ 1:33 pm
Greg
I agree, what fools we mortals be. I will repeat what i have
stated here before, that is, some of the big boys’ are as
crooked as crooked can be, or if that is a bit strong how
about, they are informal criminals. They lie through their
teeth & will not be satisfied until they try to take every
last penny we have. As for some of the companies on the Venture,
They try to impress, by stating that they are not permitted
to give inside information, hello ! one would be surprised who
is the receiver of inside information. Why do stocks take off
before news ? I realize there are some, who are inclined to
follow the leaders, but who are the leaders, no doubt, close
to companies. As for lying, i try to be as honest as is
humanly possible, but i wonder why, when the liars, the
politicians, et al., seem to thrive with their lies, i hear it
every day as i scour world news. I sympathize with Jon/John,
they seem to be doing their best, but may i remind them, it is
difficult to fight a rotten system my friends. They have been
fighting the system for years now & i have watched closely, one
step forward & two back. So Greg, i see where you are coming from.
My recent posts have not been very positive, but what is there
to be positive about ? well ! we are still alive & kicking &
able to complain, which is one way of venting our frustrations.
Have a good evening..
Comment by Greg — January 29, 2015 @ 3:02 pm
It didn’t take long did it !!!!
Russia extends olive branch to Greeks
Geoff Cutmore | Jenny Cosgrave
4 Hours AgoCNBC.com
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Russian Finance Minister Anton Siluanov told CNBC that Russia would consider giving financial help to debt-ridden Greeceājust days after the new Greek government questioned further European Union sanctions against Russia.
Comment by Bert — January 29, 2015 @ 3:39 pm
I agree with Greg! Every time venture take one step forward very soon it takes two steps back. I am so tired of it. I know this will end but when? I have money on the sideline and I dont buy anything until U can be sure the Venture will take off!
Comment by Yvonne Kindstrƶm — January 30, 2015 @ 6:11 am
Hey Bert
when you posted to me above you forgot to post under your Bert name, you posted under Greg, gotcha!! Bert/Greg are the same person, too funny…
Bert always types with the small i not a capital I like most people do….
Comment by Greg — January 30, 2015 @ 8:48 am
Greg
Just goes to show that i am far from perfect, I bet when you read
my post, you felt you were talking to yourself. As for the I/i,
starting off a sentence the I would be in order, otherwise i, so
there you go, i am 50/50 again today.
What kind of berry is that ?
Why, it’s a Blueberry,
How can you call it a Blueberry, when it is White ?
That’s because it is still Green.
Comment by Bert — January 30, 2015 @ 9:19 am
No worries Bert
We still love ya!
Comment by Greg — January 30, 2015 @ 11:26 am