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July 12, 2011

BMR Morning Market Musings…

Gold has traded in a range of $1,540 to $1,556 so far today…as of 8:00 am Pacific, the yellow metal is off $3 an ounce at $1,551…Silver has dropped 31 cents to 35.44…Crude Oil is is essentially unchanged at $95.13 while the U.S. Dollar Index, which has touched its highest level in more than three months, is now up just slightly at 76.07 after gaining as much as three-quarters of a point earlier in the morning…Gold priced in euros has hit a record high as fears Europe’s debt crisis could spread despite European Union officials’ pledges to help heavily indebted euro zone members…euro zone finance ministers promised cheaper loans, longer maturities and a more flexible rescue fund yesterday to help Greece and other EU debtors in a bid to stop financial contagion engulfing Italy and Spain…Italy’s borrowing costs came off a euro-era high this morning after a relatively successful debt auction in Rome…however, markets are fearing that Italy, the fourth largest economy in Europe with a debt of about 125% of GDP, will be drawn into the sovereign debt crisis…Italian Prime Minister Silvio Berlusconi didn’t help matters after an apparent falling out with his fiscally conservative finance minister, Giulio Tremonti, who has skillfully kept Italy out of trouble in the bond market despite the country’s high debt levels and sluggish growth…the controversial Berlusconi was quoted in an Italian newspaper as saying Tremonti was not a “team player”, only “spoke to markets”, and “thinks he is a genius and thinks everyone else is a cretin”…sounds like Italy has its own version of Jean Chretien and Paul Martin…anyway, not to underestimate the debt problems in Europe, but commodities are showing surprising resilience in the face of a toxic mix of worries about global growth and debt concerns…Copper, for example, continues to hold up very well and you won’t see that headline in the mainstream media…it’s trading up 3 cents at $4.35 a pound this morning…the Copper chart is bullish as John has pointed out and this metal is such a powerful leading indicator…China’s Copper imports rose 9.9% last month, snapping two months of losses…Crude Oil is certainly not collapsing and the Canadian Dollar is holding strong, just above its rising 100-day moving average (SMA) as measured against the greenback, despite the resource-heavy Canadian economy…market weakness yesterday allowed the fearmongers to come out in droves, though a pullback was really not surprising given the 6% jump in the Dow in three weeks and a 4% jump in the CDNX last week alone…Richard Young’s Intelligence Report stated yesterday, “”Twice in just 10 years, investors have been badly burned by excessive stock market valuations, and it’s about to happen AGAIN…this time it’s going to really hurt…you, and millions of other investors, are about to be blindsided by a falling market that will pull the rug out from under you…we’re going to see just how fast stocks can fall without the support of QE2″…well, there are many Richard Youngs out there who want us to cower in fear…the CDNX has proven over the years to be an extremely reliable leading indicator and it remains in a long-term bull market, as John’s latest chart has shown, which is a positive sign for equity markets in general, commodities and the global economy…below is also an interesting chart from www.usfunds.com which shows where the broad market is at on the “negativity pendulum” (it has quite possibly swung too far)…

After a 40-point loss yesterday, the CDNX is off another 12 points as of 8:00 am Pacific at 1933, just a couple of points below its rising 10-day moving average (SMA)…the 20-day SMA provides additional support at 1918…individual situations to keep an eye on…Currie Rose Resources (CUI, TSX-V) is trading at 17 cents, just 1 penny above its supporting and rising 300-day SMA…drilling is ongoing at CUI’s Mabale Hills Project in Tanzania and each of the company’s three main properties there has the potential to produce some stellar results…Adventure Gold (AGE, TSX-V) got smacked down to 54 cents yesterday, just above its supporting 200-day SMA…AGE is one of the top plays along the Cadillac Trend in our view and we are particularly excited about the company’s Pascalis-Colombiere Gold Property near Val d’Or which is an attractive emerging deposit…we’ll have more on Pascalis-Colombiere in the near future…Visible Gold Mines (VGD, TSX-V) has the potential for a powerful summer with drilling beginning shortly on its Joutel Project and drilling continuing on its large Cadillac/Lucky Break land package west of Rouyn-Noranda…with about 30,000 metres of drilling over the final six months of this year, it’s hard to imagine VGD not hitting something significant in northwest Quebec given the quality of its geological team…GoldQuest Mining (GQC, TSX-V) has a superb portfolio of projects in the Dominican Republic and Spain and is trading right around support at 19 cents…of course we’re bullish on some of the Yukon plays…Silver Quest Resources (SQI, TSX-V), which also has an interest in the northern portion of the Blackwater deposit in central British Columbia, is up a penny at $1.12 this morning…Kaminak Gold (KAM, TSX-V) dropped as low as $4.06 yesterday before rallying to finish the day at $4.30…it’s off 6 cents currently at $4.24…Golden Predator (GPD, TSX-V) is down 3 pennies at 95 cents…Ethos Capital (ECC, TSX-V) is up 2 cents at $1.23…ECC is exploring aggressively and holds over 100,000 hectares in the White Gold District…Richmont Mines (RIC, TSX) got a nice plug on BNN this morning and has jumped 37 cents to $7.37 after a ridiculous drop of 45 cents yesterday…we’ve been screaming from the rooftop with regard to Richmont lately…perhaps the market will finally awaken to this play when the company’s second quarter earnings come out next month…RIC in our estimation is trading at less than 10 times projected 2011 earnings and the company’s Gold production is expected to jump by 40% next year and could triple within three years – tuck RIC away for the long-term, you’ll be glad you did…Gold Bullion Development (GBB, TSX-V) continues to be one of our favorites…a 43-101 resource estimate on Granada and the spin-off of the Castle Silver Mine Property are major developments to watch out for this summer in addition of course to continued results from the LONG Bars Zone…John’s chart shows strong support at the Fibonacci 38.2% level at 42 cents which is also two pennies above the supporting 500-day moving average (SMA)…GBB is currently unchanged at 43.5 cents…

24 Comments

  1. My sixth sense tells me GBB will drop below 40 cents. I will come back to buy at this level. I sold all my GBB at 47 cents. SD may go back to 3 cents but it will go back up to 3.5 – 4 cents range.

    Comment by Theodore — July 12, 2011 @ 8:53 am

  2. Well Theodore, why wouldn’t you save your cash and buy SD – that’s what your sixth sense told you the other day?

    Comment by Andrew — July 12, 2011 @ 9:00 am

  3. Quick question for BMR. Do you know if Douglas McKay and Associates are still being engaged by VGN as their IR company? Or is it true that DM & A Dumped VGN as a client? If they did DUMP them as a client, any reason for it? It is my understanding that drilling is about to commence at VGN’s Blackwater property very very soon. Also, I understand that Tony is working on something SPECTACULAR to unlock share holder value, has BMR been in contact with anyone at VGN? And, if Tony is now working EXCLUSIVELY at VGN, why would he bother having ANY interest in God foresaken Zimbabwe, ZOO?? Could Tony be paying off government officials in Zimbabwe, for a nice ” invaded” farm so he can retire under the protection of Bob Mugabe?

    Comment by john — July 12, 2011 @ 9:00 am

  4. Why don’t you ask Tony or his secretary or even DM & A – you’re so “in” with Tony these days – get it from the horse’s mouth! Did he come back from Mexico wearing a sombrero or carrying a briefcase? If the former he was definitely on holiday!

    Comment by Andrew — July 12, 2011 @ 9:04 am

  5. http://incakolanews.blogspot.com/2011/07/peregrine-metals-pgmto-nice-way-to.html

    Comment by Stone — July 12, 2011 @ 9:10 am

  6. Stone – spam your IKN luncheon meat somewhere else – no one’s interested, try SH. Bye!

    Comment by Andrew — July 12, 2011 @ 9:12 am

  7. I want to get 10% each time from GBB buy/sell… SD is not a moving stock until the news come out. I have enough porfolio under SD. I am on the buying list of GBB now. I will increase my shares holding by 10% due to price difference. I will not be able to achieve this in SD…. big lot in 3 cents and most stocks are sold at 3.5 cents.

    Comment by Theodore — July 12, 2011 @ 9:18 am

  8. Now, now, you be nice & civil there Andrew, just pointing out a home run that Otto nailed with PGM in his IKN Weekly seing how you mentioned that Inca was a waste of time. The same goes for Alec as Otto has informed many a folk on his blog of juniors to be watchful of…have a good one!

    Comment by Stone — July 12, 2011 @ 9:18 am

  9. To state that i am surprised & happy with the North American Markets
    today, is putting it mildly. Before our markets opened this morning,
    i viewed a screen of red, as they showed the results from world
    markets. I predict a big day once the U.S. senators get their act
    together & raise the debt ceiling & IT WILL GET RAISED, mark my word.
    First, they have to play the political game, and they know well, that
    there are limits’ to how far they can go. Anyway it’s a dangerous time,
    which goes to make the Bank interest rates really enticing, but we are
    gamblers’ aren’t we ?

    R !

    Bert

    Comment by bert — July 12, 2011 @ 10:12 am

  10. Me too, Bert! The Venture is currently on track for a positive finish. SGC up nicely and HRC. GBB has held and a surprise for me was to see GPR gain from their news release this morning.

    Comment by Andrew — July 12, 2011 @ 10:39 am

  11. Hello Andrew

    I see VGD didn’t hold & is moving back, but it will have it’s day
    in the sun. It’s one i intend holding. I notice HRC had news out
    today & we have to look at the big picture when looking at the
    news. Anyway, it was enough to impress RBC/Canaccord, they are at
    0.42 for 100k/50K. It may take some time, but i have placed that
    one in my SAFE column.

    R !

    Bert

    Comment by bert — July 12, 2011 @ 10:59 am

  12. Too funny Theodore.

    Taking advice and buy and sell signals from someone even investing a dollar in SD can’t be healthy.

    But keep dumping your GBB and keeping the trend down for us, hope you get halted and caught with your pants down since you’re the only retail I know selling at these low levels and bragging about it.

    Comment by Taylor — July 12, 2011 @ 11:04 am

  13. Got to agree with Taylor. If you all you want is 10% I dont think this is the right sector for you. This is the most volatile sector in any market and pretty soon it will start its annual rally. GBB will be over $1 by year end and if not large doses of humble pie will have to be consumed. In my view the rally which should start soon will be at least as good as the one last year. And now the FED are hinting strongly at more QE in some form. These guys will never stop printing because they know nothing else and this will eventually send top quality juniors on a rocket ship. Patience seems to be the hardest word.

    Comment by Patrick — July 12, 2011 @ 12:29 pm

  14. I bought GBB back at a good price today…. not feeling safe without a single share of GBB. My 10% shares increase works again this time. Also, I bought SFF today at a lower price…. So, I am now holding porfolio in GBB, SD and SFF. I am still not too interested in buying VGN at this moment.

    Comment by Theodore — July 12, 2011 @ 1:42 pm

  15. If i make a mistake, i have to correct it asap.. A few days ago i posted that VGD moved outside
    the upper b/b & that indicated a reversal, instead it was indicating a continuation of the trend.
    As it happened, the stock moved back & i was correct, but that’s not the way i want to be right. I
    would suggest though, that it may have moved up because of BMR’s write up & nothing else, as it appears
    not to have the legs to continue, but time will tell.

    R !

    Bert

    Comment by Bert — July 12, 2011 @ 5:49 pm

  16. I wonder if we keep ignoring him, he/she/it, will go away? $400 bucks a year! ouch, better just stick with BMR! Cheaper and better and at least they use real names and return calls and emails? Really!!!
    Have a nice day! Oh rats, ignore button doesnt work, too bad I ll have to read about it tomorrow!

    Comment by alec — July 12, 2011 @ 7:51 pm

  17. For what it’s worth, 3 hours before open, it appears we will have a positive start.

    R !

    Bert

    Comment by Bert — July 13, 2011 @ 2:47 am

  18. Things look rosy this morning – should be a good day! News release from GBB but not sure if it’s good – 30% of the holes were duds, so I’ll be interested to read Jon’s interpretation.

    Comment by Andrew — July 13, 2011 @ 5:14 am

  19. Sounds like GBB needs to drill more for NI report. They should just get the NI report based on what they have so far, then do another NI report 6 months downs the road.

    “Drilling at the Granada property continues … focussing on infill drilling for a drill hole density to allow completion of a preliminary resource calculation”

    Comment by Bruce — July 13, 2011 @ 6:11 am

  20. Andrew

    FYI I noticed a recent buy rating out on SGC.

    Comment by Bert — July 13, 2011 @ 6:24 am

  21. Thank you, Bert. SGC is on the move this morning. Looks like the Venture will test 2000 today.

    Comment by Andrew — July 13, 2011 @ 7:21 am

  22. http://incakolanews.blogspot.com/2011/07/gold-bullion-development-gbbv-defends.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+IncaKolaNews+%28inca+kola+news%29

    Comment by Stone — July 13, 2011 @ 7:41 am

  23. @Stone

    Inka Kola?? Peruvian coke? Who is this person. They dont understand bulk tonnage mining.

    Comment by Hugh — July 13, 2011 @ 8:30 am

  24. I would suspect that he/she/it is getting paid to bash? I mean just out of the blue out of thousands of venture stocks, stoner pics GBB? What a strange coincidence, maybe you can run some stats on that and see what the probability of that would be? Maybe he/she/it, is just wanting to buy cheaper GBB shares before they run up? I m really not sure what he/she/it, is trying to prove? LOL, all the more reason to buy some more on the dip down as GBB will be delievering the 43-101 pretty soon!
    Keep posting Peruvian Coke.

    Comment by alec — July 13, 2011 @ 10:37 am

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