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Gold has traded between $1,218 and $1,242 so far today…as of 7:30 am Pacific, bullion is down $24 an ounce at $1,219 ahead of tomorrow’s U.S. non-farm payrolls report and consumer sentiment – numbers the market will be studying closely for clues as to when the Federal Reserve may decide to begin to wind down its bond-buying program…Silver is off 39 cents at $19.33…Copper is down 2 pennies at $3.19…Crude Oil is 52 cents higher at $97.72 while the U.S. Dollar Index has fallen one-fifth of a point to 80.42…

Strong Chinese and U.S. demand should help drive commodity prices higher in 2014, ETF Securities stated in its outlook yesterday, listing Copper, Lead, Platinum and Palladium among its top picks…the firm suggested recent negative sentiment toward Gold is “overdone” and anticipates that the combination of physical demand spurred by low prices, falling output and less recycling will help limit any further downside…

Commodities underperformed developed-market equities for the third consecutive year in 2013, following 10 years of outperformance, ETF Securities noted…slowing Chinese economic growth, jitters that the U.S. Federal Reserve could cut back on quantitative easing, plus rising supply expectations have been the main factors weighing on the sector, the company stated…

However, ETF Securities sees an improved tone for commodities in 2014, calling for a “turnaround year for this laggard asset class”…

Gold’s intra-day reversal yesterday was encouraging, regardless of this morning’s weakness…obviously tomorrow will be a critical day for Gold to see how it handles the jobs report and finishes the week…John’s 6-month daily chart shows the recent bearish trend that sent Gold down by 10% since the end of October is weakening…a convincing push through the $1,250 area is required in order to give Gold fresh upside momentum…

U.S. Q3 Economic Revisions

The U.S. economy grew faster than initially estimated in the third quarter as businesses aggressively accumulated stock, but underlying domestic demand remained sluggish…gross domestic product grew at a 3.6% annual rate instead of the 2.8% pace reported earlier, the Commerce Department said this morning…economists polled by Reuters had expected output would be revised up to only a 3% rate…growth could fall sharply in the fourth quarter, however, if companies stockpile goods at a slower rate as expected…

The third quarter pace is the fastest since the first quarter of 2012 and marked an acceleration from the April-June period’s 2.5% rate…businesses accumulated $116.5 billion worth of inventories, the largest increase since the first quarter of 1998…that compared to prior estimates of only $86 billion…

Consumer spending, which accounts for more than two-thirds of U.S. economic activity, was revised down to a 1.4% rate, the lowest since the fourth quarter of 2009…spending had previously been estimated to have increased at a 1.5% pace…

Fed’s Beige Book Says U.S. Expanding At “Modest To Moderate” Pace

The U.S. economy expanded at a “modest to moderate” pace in recent months, the Federal Reserve said yesterday in a report that showed mixed economic conditions across the nation just prior to a key policy decision by the central bank…the beige book, which assesses the economic environment in the Fed’s 12 districts, cited strength in the U.S. manufacturing sector and consumer spending…seven districts reported steady growth rates and four districts indicated a less robust expansion than the others…one region simply said economic activity continued to expand…the snapshot, based on information gathered from early October through November 22, comes two weeks before the Fed’s Dec. 17-18 policy meeting…the Fed will decide at that meeting whether to start pulling back its $85 billion-a-month bond-buying program, which is aimed at lowering borrowing costs to spur stronger spending, hiring and growth…

Meanwhile, a separate survey released yesterday by the Business Roundtable, a group of top corporate executives, found U.S. CEO’s the most bullish they’ve been about the economy in almost two years…the survey’s economic outlook index for the fourth quarter rose to its highest point since early 2012…executives said clearer signals from Washington could help the economy accelerate…“We have an economy that is on the cusp of growing at more than the 2-to-3% we’ve seen,” said Boeing Co. CEO Jim McNerney, who is chairman of the group. “Washington sorting themselves out would give businesses a more predictable environment to invest the cash on their balance sheets and hire people.”

That’s the key – political dysfunction and poor fiscal policy at federal levels are hampering the ability of the U.S. to accelerate growth and allow the economy to reach its full potential, which in turn has been forcing the Fed to keep its pedal to the metal…at a time when job growth needs to gain even more traction, President Obama continues to insist that Congress should hike the minimum wage from the current $7.25 an hour to as much as $9 an hour – a whopping 24% increase that would guarantee that businesses would reduce their payrolls and/or hike prices…but this of course is also the same President who brought forth the Unaffordable Health Care Act as part of his social engineering agenda, creating another burden for business and actually increasing health care costs for many Americans…

Today’s Markets

Asia

Asian markets were lower overnight, though China’s Shanghai Composite fell just 5 points to 2247…Japan’s Nikkei Average slipped 230 points or 1.5% to close at 15177…

Europe

European shares were down slightly today…the ECB left its benchmark interest rate unchanged at 0.25% after surprising markets with a rate cut last month…ECB President Mario Draghi gave no sign of imminent monetary policy easing…the ECB expects inflation at 1.4% in 2013, 1.1% in 2014 and 1.3% in 2015, still well below the bank’s target of 2%…the forecast for 2013 was a 0.1 percentage point cut from the bank’s September forecast, while for 2014 it was revised downwards by 0.2 percentage points…

North America

The Dow is down 37 points through the first hour of trading…the TSX has lost 72 points while the Venture is flat at 920 – holding up well despite Gold’s weakness and softness in the broader markets…strong support persists in the low 900’s…the Venture’s weekly close tomorrow should provide some important fresh technical clues…

Canadian Dollar Chart Update

The daily chart shows the Canadian dollar quite oversold and due for a rebound at the very least, which is good news for the Venture as the two generally have a high correlation…John’s 5-year monthly chart shows the dollar is now at long-term support going back to the beginning of 2010…rallies in the Venture have consistently occurred around the time the loonie has touched long-term support, which bolsters the case for a year-end push by the Venture after it first navigates some more choppy seas which are common during the first half of December…

Global Cobalt Corp. (GCO, TSX-V)

Global Cobalt (GCO, TSX-V) is another candidate, in our view, for a strong finish to the year…it’s off a penny at 17.5 cents through the first hour of trading today, but that’s after a 3-cent jump yesterday…drilling continues at GCO’s Karakul Cobalt Project in Russia…technically, the stock has been consolidating within an ascending triangle, as shown in John’s 3-month chart, while unwinding overbought conditions that emerged in October…

Madalena Ventures (MVN, TSX-V) Update

Madalena Ventures (MVN, TSX-V) has closed its bought-deal financing, including full exercise of the over-allotment option, for total gross proceeds of $9.2 million…MVN has excellent prospects for 2014 and, as we’ve stated repeatedly, is very worthy of our readers’ due diligence…more on MVN Monday…as of 7:30 am Pacific, MVN is up a penny at 51 cents…

Contact Exploration Inc. (CEX, TSX-V)

Another oil and gas junior that we’ve been tracking in recent months with increasing interest is Contact Exploration (CEX, TSX-V) which continues to accelerate its Kakwa Montney play in Alberta..CEX continues to look poised for a breakout by Q1 based not just on fundamental factors – continued increases in production as East Kakwa pushes westward – but given the underlying bullishness of the long-term chart…as always, perform your own due diligence…below is a 2.5-year weekly CEX chart from John…since late 2012, CEX has been trading in a horizontal channel between 18 cents and 28 cents...CEX closed yesterday at 27 cents (no trading so far this morning)…

Note: John, Terry and Jon do not hold share positions in GCO, MVN or CEX.