BullMarketRun.ca

Gold has traded between $1,181 and $1,195 so far today…as of 8:30 am Pacific, bullion is down $16 an ounce at $1,182…Silver is off 33 cents at $16.64…Copper is up 2 pennies to $2.79…Crude Oil has given up 57 cents to $48.30 while the U.S. Dollar Index has added more than half a point to 98.00…

TD Securities, in a precious metals outlook published recently, questions the sustainability of the supply/demand balance in the Gold market due to declining reserves…2014 marked the 3rd straight year of reserve declines, with exploration spending being reduced as miners focused on capital preservation…total reserves for the large-cap producers are down around 24% from the 2011 peak…the decline highlights that existing exploration budgets are not sufficient to keep pace with current mining depletion…

Yellen:  Gradual, Gradual, Gradual…

Fed Chair Janet Yellen struck a moderate tone in a speech late Friday at a conference sponsored by the San Francisco Fed, and that’s one reason equity markets are buoyant today – along with talk of more stimulus coming from China…

“I expect that conditions may (our emphasis) warrant an increase in the federal funds rate target sometime this year,” Yellen stated Friday…she said she was “cautiously optimistic” that growth would top 2.3% this year and that the unemployment rate would fall further…consumer spending is likely to rise “at a good clip,” she added, though fresh numbers this morning were a little disappointing…

Yellen stressed several times that the Fed would be cautious in its actions and that subsequent rate hikes likely would be gradual…in fact, she used the words “gradual”, “gradually”,  and “gradualist” 14 times in her prepared remarks…

Today’s Markets

Asia

China’s Shanghai Composite keeps motoring along…the index hit a fresh 7-year high overnight, soaring nearly 100 points or 2.6%, as markets interpreted weekend comments from Zhou Xiaochuan, governor of the People Bank’s of China, as an indication of further stimulus…Zhou warned yesterday that the world’s 2nd-largest economy needs to be vigilant for signs of deflation (which are quite evident, actually)…

Japan’s Nikkei average climbed 126 points overnight to close at 19411…

Europe

European stocks rose broadly today on hints of more monetary easing from China and solid confidence numbers from the euro zone…Greece’s Syriza-led government on Friday presented ideas on fresh proposals for economic overhauls, but so far officials from the ECB, EU and IMF aren’t convinced the suggested reforms are detailed enough…with debt payments due over the next few weeks, many economists believe the country will run out of money at some point in April unless the next portion of bailout cash is released…

North America

The Dow is bouncing back strongly after last week’s decline…as of 8:30 am Pacific, the Dow is up 264 points…

U.S. consumer spending barely rose in February as households boosted savings to their highest level in more than 2 years, the latest sign that economic growth slowed sharply in the 1st quarter…the Commerce Department said today that consumer spending edged up 0.1% (slightly less than expected) after an unrevised 0.2% drop in January…households cut back on purchases of big ticket items like automobiles…

In other economic data released this morning, personal income in February rose 0.4%, above expectations of 0.3% increase…

In Toronto, the TSX has added 175 points through the first 2 hours of trading while the Venture, trying to gain traction above key resistance at Friday’s close, is off 1 point at 680…

Stephen Poloz, head of the Bank of Canada, said a slump in Oil prices is having an “atrocious” effect on the Canadian economy but a cheaper currency and a U.S. revival should help exports drive a recovery, according to a report this morning from the Financial Times…

TSX Updated Chart

Since mid-December, the TSX has remained within an upsloping channel as shown in this 6-month daily chart…the index bounced off the uptrend support line on Friday after 3 straight days of declines…April looks promising as a “Wave 5” move appears to be underway with a key level being 15300 which constitutes both chart and Fib. resistance…

Doubleview Capital Corp. (DBV, TSX-V) Update

We like the trend – results keep improving each time Doubleview Capital (DBV, TSX-V) has returned to the Hat Property in northwest B.C.’s Sheslay district for a fresh round of drilling…last week, the company announced that Dr. Abdul Razique, the company’s recently recruited chief geoscientist with an impressive background in major porphyry deposits, is now leading a crew on the property to begin preparations to re-start drilling…

But first, there’s the important issue of hole #23 which was halted at a depth of 650 m just prior to Christmas for the winter shutdown…assays have been released for the first 400 m of that hole, showing the best results yet in drilling at the Hat including a 110.9-m section beginning at a depth of 270.6 m that graded 0.73% CuEq (overall, so far, H-23 includes 332.4 m grading 0.48% CuEq)…a 3rd and wider chalcopyrite-pyrite zone was visually observed starting at 402 m and continuing to at least 520 m (this core still needs to be logged, cut and sent in for assaying)…H-23 features increased potassic alteration relative to other holes, a very positive sign…importantly, the property is now showing the potential for significantly higher grades than it did a year ago when the initial discovery was made, and that’s key…much has been learned over the last several months…

On a broader level, a growing consensus seems to be that the Lisle discovery zone, where most of the 23 holes at the Hat have been drilled to date, is merely the southeastern edge of a much larger porphyry system that pinches and swells over a general NW-SE trending corridor more than 3 km long and approximately 2 km wide…

We have great confidence in Dr. Razique’s understanding of world class porphyry systems, given his intense involvement with Reko Diq in western Pakistan and our lengthy interview with him just recently…prior to joining DBV last month, Dr. Razique spent the previous year-and-a-half evaluating projects in B.C., Quebec and the U.S. on behalf of a major mining and exploration company and its joint venture partners…

To view Part 1 of our video feature (just under 90 seconds), click on the arrow below…

Amarc Resources Ltd. (AHR, TSX-V) Update

There’s lots happening in British Columbia…we do expect the Sheslay district to heat up profoundly with the potential for near-term new discoveries…not only of course is Doubleview on the cusp of a major breakthrough, but Garibaldi Resources (GGI, TSX-V) has already kicked off its 2015 exploration season at the Grizzly which will lead to first-ever drilling – and we know what their success ratio is like on drill holes elsewhere…

Further south in the Cariboo region, meanwhile, Amarc Resources (AHR, TSX-V) is garnering increased attention as predicted following its announcement in late November that was overshadowed by the overall market turmoil at the time…

Volume has picked up significantly in AHR this month, and the company has the funds to carry out a follow-up round of drilling…AHR traded as low as 6.5 cents in December and hit a new 52-week high of 18 cents March 19…

In late November, Amarc reported highly encouraging results from an initial 9-hole drill program at the company’s IKE Project in the Cariboo region…this is an early-stage bulk-tonnage porphyry Copper-Molybdenum-Silver discovery in the heart of a producing area…all 9 holes intersected chalcopyrite and molybdenite mineralization from surface and over a broad area measuring 1,200 m east-west by 600 m north-south and to depths of approximately 500 m…

Interval highlights included 247 m grading 0.42% CuEq in IK-14-001; 234 m @ 0.43% CuEq in IK-14-002; and 308 m @ 0.41% CuEq in IK-14-006…these results, along with post-drilling geological, geochemical and geophysical surveys completed outward from the drilled area, indicate that the IKE porphyry system has the potential to host a significant resource…this is still early in the game…AHR can be expected to aggressively follow up on this discovery…

John’s 3-year weekly AHR chart shows a “Big Picture” bullish trend with a confirmed breakout above the 10-cent level early this month with a recent confirmed breakout above Fib. resistance at 15 cents…buy pressure has recently replaced a long period of sell pressure…

Below is an updated 3-year weekly chart for AHR which closed Friday at 17 cents…

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

As regular BMR readers know, we love northern British Columbia…geologically, it is so richly endowed…the Sheslay area, we predict, will become a world-class Cu-Au porphyry district, handsomely rewarding investors who can envision that now, but up and down northern B.C. there are still enormous opportunities for new discoveries of various types despite all that has been found (just the tip of the iceberg, really) over the past couple of decades…

Eskay Mining (ESK, TSX-V) is a company we initially introduced to our readers when it was trading at just 6 cents a year ago…given the collapse of the Venture to a record low in December, it’s quite remarkable that ESK is trading at 15 cents right now but that’s a testament to the quality of the company’s holdings…

ESK 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…a technical adviser for ESK is the highly respected James Rogers who was Chief Geologist at the Eskay Creek mine between 1994 and 2003…Rogers prepared an ESK corporate presentation last summer which is available on their web site – we suggest our readers check it out…

Recently, Eskay added well-known geologist Charlie Greig to its technical team…Greig is a master at his craft and consults for Pretium as well as Garibaldi…

Technically, ESK broke out above a long-term downtrend a year ago and that’s initially what caught our attention along with a surge in volume…

Below is a 3-year weekly ESK chart from John…little news but this stock has been under heavy accumulation for a reason, we suspect…

Niogold Mining Corp. (NOX, TSX) Update

In northwest Quebec, Niogold Mining (NOX, TSX-V) continues to find high-grade shoots surrounded by lower-grade halos that characterize the wider, mineralized shear zones at its 100%-owned Marban deposit…recent results included 15.8 m @ 4.95 g/t Au, including 4.2 m grading 12.58 g/t Au, in hole MB-14–372 at a vertical depth of 120 m…the infill program has been increased from 40,000 m to 50,000 m…

Technically, NOX has performed exceptionally well in turbulent markets since the beginning of last year…consistently, it has found strong support at its rising 200-day moving average (SMA), currently 29 cents…

Buy pressure continues to increase as indicated by the CMF…excellent possibilities here for the balance of 2015…

Silver Short-Term Chart

Silver got a boost recently when it broke out of a short-term downsloping flag that was in place since late January…the metal found support at the bottom of that flag during the middle of this month which was critical…the chart now suggests that a consolidation has now started after the rather rapid ascent (15%) from the monthly low of $15.20…

The metal reacted in January at $18.50 (almost exactly at chart and Fib. resistance) and then went into a consolidation phase within the downsloping channel…we were waiting for a move above or below that channel, and it came at the end of the week of the Fed policy statement…

In December, Silver finally staged a definitive breakout above a downtrend line that was in place since the summer (note how the downtrend line became new support that month)…this gave Silver the fuel it needed to test higher levels…

Silver Long-Term Chart

This 34-year monthly chart continues to give hope that Silver could be in the very early stages of a powerful “Wave 5” move to the upside, though we caution that this could take some time to play out (if indeed this theory is correct)…the reasons for such a possible move are also not clear at the moment…

RSI(14) has bounced off previous long-term support which will need to hold along with key price support in the immediate vicinity of $15…

One note of concern on this chart is the sell pressure that has prevailed since the beginning of 2013, after a decade-long period of buy pressure…based on historical patterns, sell pressure could persist for a considerable time yet – though that doesn’t necessarily mean that the price can’t still trend higher…nonetheless, it would be encouraging to see this sell pressure begin to abate…it has eased off only very slightly in recent months…

Note:  John and Jon both hold share positions in GGI.  Jon also holds a share position in DBV.