Gold has been trading in a narrow range so far today…as of 5:45 am Pacific, the yellow metal is down $2 an ounce at $1,587 after Friday’s $17 jump…Silver is 19 cents lower at $27.15…Copper is off 2 cents at $3.47…Crude Oil is down 48 cents at $86.62 while the U.S. Dollar Index is up over a tenth of a point, but off its highs of the day, at 83.43…
Silver’s Screaming Signals
Not only is Silver’s COT structure exceedingly bullish, with commercial traders reducing net short positions to record lows, but a couple of charts from John show how Silver is such an incredible buying opportunity at the moment…it is poised to explode higher in a move that could easily begin at some point this quarter…this analysis comes at a time when the general public is not excited about Silver, another bullish sign…
The first chart below goes back to 1998, a 15-year monthly chart…Silver is currently at the bottom of “Wave 4”, and notice how the RSI(2) is at its most extreme level since the 2008 Crash…with a chart such as this, and commercial traders also very bullish, now is clearly the time to be positioned in quality Silver stocks to take advantage of what could turn out to be an historic buying opportunity…
John’s second Silver chart this mornings shows a “double bottom” pattern and a down trendline in place since March that is likely to be overcome this summer…RSI(2) is also emerging out of extreme oversold conditions…
Rainbow Resources (RBW, TSX-V) Chart Update
On the subject of Silver, it’s interesting to note that Rainbow Resources (RBW, TSX-V) is a step ahead of the metal at the moment – RBW is one of the first stocks to break above its down trendline as shown in John’s 1.5-year weekly chart…not shown on the chart are RBW’s 200 and 300-day moving averages (SMA’s) which continue to rise, confirming a long-term uptrend remains intact, while the 50-day SMA has flattened out and is ready to reverse to the upside once the stock clears resistance at 20 cents (drilling should trigger that)…
Great Panther Silver (GPR, TSX)
Another Silver play to watch closely is Great Panther Silver (GPR, TSX) which should be able to achieve increased production during the second half of the year…GPR closed at $1.70 Friday with buying pressure, as indicated by the CMF, climbing to its highest levels since February…in addition, there are other very positive signs in the GPR chart as John shows below…
Another Takeover
Canadian-based La Mancha Resources (LMA, TSX), with mining interests in Australia, West Africa, Sudan and Argentina, is being taken over by an Egyptian billionaire for about $500 million or $3.50 share which compares favorably with the 50% average premium in Gold takeovers this year valued at $100 million or more…the deal was announced late in Friday’s trading session with LMA gaining $1.18 per share to $3.43…
Another company to keep a close eye on as a potential takeover target before year-end is Lumina Copper (LCC, TSX-V) which closed Friday at $8.46…Lumina has already put itself on the block, though recent overall market weakness has seen the stock fall in 7 out of the last 8 trading sessions…it is oversold on the charts and could be forming an inverted head and shoulders bottom…
China Takes New Steps To Encourage More Foreign Investment
Foreign companies in China will see taxes on the profits they take out of the country cut by up to 50% after rules around withholding taxes were relaxed as part of efforts to encourage more foreign investment…the move will also apply to dividends paid on Chinese listed stocks to foreign owners through the Qualified Foreign Institutional Investor scheme, although in both cases the lower tax rates will apply only to owners in countries with double taxation agreements with China including the UK…
Today’s Markets
Stock index futures in New York are pointing toward a slightly lower open on Wall Street to begin the new week…market focus this week will be on Federal Reserve Chairman Ben Bernanke as he gives his semi-annual report before the Senate Banking Committee tomorrow and a House Committee Wednesday… Investors will listen for any hints of further stimulus measures, but they’ll also likely hear Bernanke warn lawmakers about the impending so-called “fiscal cliff”…
European shares are off slightly this morning while China’s Shanghai Composite fell 38 points overnight to 2148 on some profit warnings…
Venture Exchange
The Venture Exchange closed up 18 points Friday to close at 1187, but volume remains low…with the Venture chart, what we’re looking to see confirmation of is a “double bottom”…for the moment the Index is stuck in a range between the June low of 1154 and the EMA-20 at 1215…
Note: John and Jon hold share positions in RBW. John, Jon and Terry do not hold share positions in GPR.
did anyone take advantage of OYL dip on bad news. If so, congrats. Made for a good trade today. More than likely it will fill in the gap at .30
Comment by dave — July 16, 2012 @ 9:01 am
A front page story in the New York Times, indicates the money pockets
are privy to sensitive information, before it becomes public. You can
be sure this is going on everywhere. Pray tell me, do we, the lowly folk,
have a chance by playing on an unlevel field…Anyway, the first paragraph
reads as follows:-
Quote
They are supposed to be among Wall Street’s most closely guarded secrets:
changes in research analysts’ views, up or down, of a company’s prospects.
But some of the nation’s biggest brokerage firms appear to be giving a handful
of top hedge funds an early peek at these sentiments — allowing them to trade
on the information before other investors get the word.
Unquote
Comment by Bert — July 16, 2012 @ 3:38 pm