BullMarketRun.ca

Gold has traded between $1,103 and $1,126 so far today as the Fed begins a much-anticipated 2-day meeting…as of 9:45 am Pacific, bullion is up $19 an ounce at $1,124…Silver has surged 52 cents to $14.92…Copper is up slightly at $2.44…Crude Oil has jumped nearly $3 a barrel to $47.24 while the U.S. Dollar Index has slid nearly half a point to 95.21…

CPM Group sees Gold as an “excellent investment at current prices” although a sharp rally could still be a couple of years away, they contend…the New York-based consultancy included the view in a late-Monday market commentary downplaying market rumors about the Comex potentially not having enough warehouse inventories to meet hypothetical demand…such rumors surface periodically, but CPM Group reports that while the percentage of Comex Gold open interest covered by total Comex reported stocks has fallen over the past year and a half, it remains high by historical standards and “presents no perceptible risk of imminent problems with deliveries.”

CPM Group views Gold as an excellent investment at current prices and market conditions, on a long-term basis.  “We do not expect prices to rise sharply for a couple of years, however, since we do not see any exogenous economic or political problems become so threatening as to stimulate sharp increases in investment demand until late 2017 at least.”

Any hawkish guidance from Federal Reserve members, even if they leave interest rates unchanged tomorrow, could mean renewed pressure on Gold, according to TD Securities…while the Federal funds futures have been pricing out the possibility of a September U.S. rate hike, many traders are suggesting that Fed officials may also send a message saying they are willing to hike rates this year, provided the economy cooperates, TDS says…if so, an increasing U.S. dollar and upward short-term rate moves would lift Gold carry costs, TDS stated…

Interesting – for the first time in the 5-year history of CNBC’s Fed Survey, a plurality of respondents forecast that the central bank WILL raise rates at the current meeting…despite harrowing market volatility and rising anxiety over global growth, 49% see the Fed hiking rates tomorrow…of the 51 economists, money managers and strategists who responded, 43% say the first hike will come later, down 4 points from the August survey…the percentage saying they are unsure rose to 8% from 5%…

At BMR, we see a U.S. dollar with increasingly poor technicals that could break below key support in the near future, no matter what the Fed announces tomorrow…

Hungary Seals Off Border With Serbia

Hungary sealed off its border with Serbia with massive coils of barbed wire yesterday and began detaining migrants trying to use the country as a gateway to Western Europe, harsh new measures that left thousands of frustrated asylum-seekers piled up on the Serbian side of the border…human rights activists condemned the move, with Amnesty International saying Hungary’s “intimidating show of militarized force is shocking.”

Prime Minister Viktor Orban defended the measures, saying he was acting to preserve Christian Europe, which he said had become threatened by the large numbers of Muslims streaming into the continent.  “The supply is nearly endless – we can see how many of them are coming,” Orban said in a televised address just before the new laws took effect at midnight.  “And if we look at the demographics, we can see that these people have more children than our communities who lead a traditional, Christian way of life.  Mathematics tells you that this will lead to a Europe where our way of life will end up in a minority, or at least face a very serious challenge.”

Mulcair’s Growing Problem – From Within…Plus Your TFSA Under Threat

The real NDP is beginning to speak up…as Tom Mulcair attempts to convince Canadians that the NDP is a “moderate” choice in the upcoming federal election, a number of prominent party supporters have strategically released a radical manifesto ahead of the October 19 vote…best-selling author and activist Naoemi Klein said the election was the best time to release the manifesto, which calls for an overhaul of the country’s capitalist economy, as politicans’ eyes are “focused so tightly on the polls.  Elections are times when our country talks about politics a lot more than usual and we talk about the direction we want our country to go.  So that’s why we launched it ahead of the election,” said Klein…Mulcair would have wished she had simply kept quiet…

The “Leap Manifesto” is signed by a number of prominent NDP supporters, including former Ontario NDP leader Stephen Lewis…it says austerity “has systematically attacked low-carbon sectors like education and health care, while starving public transit and forcing reckless energy privatizations – it’s a fossilized form of thinking that has become a threat to life on Earth.”

Where would new jobs originate?…expanding “low-carbon” sectors such as “caregiving, teaching, social work, the arts and public interest media.”

And where would the money to fund the leap originate?…easy…soak corporations and the “rich”…end (non-existent) fossil fuel subsidies…slap on transaction taxes (thus punishing and reducing transactions)…raise resource royalties…impose carbon taxes…typical NDP strategies, some of which are currently hurting Alberta, and have decimated provincial economies historically in British Columbia and Ontario…

Meanwhile, pledges by both the NDP and Liberals to roll back the Harper government’s plan to increase to $10,000 the annual TFSA contribution limit is supported by only 33% of Canadians, according to a national survey by the Angus Reid Institute…

Today’s Equity Markets

Asia

The “rescue team” jumped in near the end of the trading session to give China’s Shanghai Composite a nearly 5% gain overnight…it shot up 147 points to close at 3153…meanwhile, Japan’s Nikkei climbed 145 points to finish at 18172 (important support for the Nikkei at 18000)…

Europe

European markets were up solidly today…

North America

The Dow is up 110 points as of 9:45 am Pacific…in Toronto, the TSX, fueled by Gold and Oil today, has soared 262 points while the Venture has added 6 points to 554…Pure Energy Minerals (PE, TSX-V) gapped up and climbed as high as $1.03 following news that it has entered into an agreement with Tesla Motors Inc. for the potential supply of lithium hydroxide that Pure Energy plans to produce from the company’s Clayton Valley Lithium Brine Project in Nevada…PE has broken out above Fib. resistance at 75 cents (new support) and came within a dime of the next measured Fib. resistance in early trading today (see John’s chart in today’s earlier post) before profit-taking set in…we’ll update the PE chart with more comments for BMR Pro and Gold subscribers later today…

TSX Updated Chart

This 6-year monthly chart for the TSX is encouraging given the extent of oversold RSI(14) conditions and a broad area of strong support from the Fib. 50% level (12830) to the 1000-day moving average (SMA) around 13350…as long as the socialist hordes don’t grab the reigns of power in Ottawa, the TSX – plus the Venture – could both finish the year on a strong note…

Equitas Resources (EQT, TSX-V) Update

Equitas Resources (EQT, TSX-V) nearly reached the 23-cent Fib. resistance level yesterday before reversing and closing the day down 2.5 pennies at 18 cents…the modest pullback carried over into this morning with EQT touching support at 15.5 cents before stabilizing…the overall chart pattern continues to look highly favorable, and the start of actual drilling at Garland – to begin soon – should add some fuel to the fire, so speak…

EQT is off a penny at 18 cents as of 9:45 am Pacific…

Cardiff Energy Corp. (CRS, TSX-V) Update

We saw a good trading opportunity here last week with Cardiff Energy (CRS, TSX-V) resting at support around 10 cents…it quickly exploded to an intra-day high of 18.5 cents Friday before pulling back to fresh support around 14 cents (previous Fib. resistance) which is also the rising 100-day moving average (SMA)…room for this one to resume its climb, perhaps to the chart resistance highlighted by John….as always, perform your own due diligence…

CRS is unchanged at 15.5 cents as of 9:45 am Pacific…

Richmont Mines (RIC, TSX) Update

Richmont Mines confirmed this morning that not only is it carrying out extensive deep drilling to expand the Island Gold mine’s high-grade resource below existing workings, but the upcoming drill program will also include important step-out exploration to test 6 target areas with 30-35 holes elsewhere on the large property in northern Ontario…within a 15 km radius of the current operations are 4 past producing mines, 3 of which occur within the same regional Goudreau shear zone that hosts the Island Gold mine…this underexplored region with proven favorable geology, a lack of regional exploration data at depth and the success Richmont has had in establishing the significant 1 million ounce high-grade resource below the Island Gold mine, are all evidence of very promising, untested potential across this land package…

Island Gold Property covers 77 sq. km which includes approximately 8 km of strike length of the favourable regional Goudreau shear system…the producing mine and its defined resources span roughly 1.5 km of strike length and over 1 km to depth along this prominent shear zone, where it is pervasively silicified with disseminated pyrite and significant high grade gold mineralization…

RIC is up 14 cents at $3.97 as of 9:45 am Pacific…

Pretium Resources Inc. (PVG, TSX) Secures $540 Million U.S. Construction Financing Package For Brucejack

Pretium Resources (PVG, TSX) has secured a $540 million (U.S.) construction financing package with the Orion Mine Finance Group and Blackstone Tactical Opportunities…the financing, which provides for immediate access to $340 million (U.S.) at closing, will finance a substantial portion of the costs to develop the underground high-grade Gold mine at Pretium’s Brucejack Project in northwest British Columbia… The financing is expected to close on or about Sept. 18, 2015…the $540-million (U.S.) in proceeds from the financing cover more than 70% of the estimated capital cost of $747-million (U.S.) to develop Brucejack based on the June, 2014, feasibility study…it’s worth noting, however, that the feasibility study used an exchange rate of 92 U.S. cents to $1 (Canadian)…as a significant portion of capital expenditures are sourced in Canadian dollars, the decline in the Canadian dollar over the last year is certainly a factor in Pretium’s favor… 

Klondex Mines Ltd. (KDX, TSX) Update

Klondex Mines Ltd. (KDX, TSX) has released mineral resource updates for its high-grade Fire Creek Project and its Midas mine, both in northern Nevada…at Fire Creek, increased total measured and indicated AuEq ounces have increased 13% to 473,000…inferred AuEq oz. have increased 22% to 441,500 ounces, net of depletion…keep in mind that more than 90% of the Fire Creek land package remains untested…

At Midas, measured the indicated AuEq ounces are up 7% to 562,000 ounces while inferred AuEq ounces have decreased 8% 267,500 ounces…all resource numbers are net of depletion…

Its calls for actions stand in stark contrast to the practical platform Mulcair is offering, which includes balanced budgets, openness to free trade deals and sustainable development of Alberta’s oilsands.

KDX is up 7 cents at $3.27 as of 9:45 am Pacific…

Note:  John and Jon both hold share positions in EQT.