Gold price ignites as top gold ETF hits record inflows

The gold rally gained momentum on Monday as retail and institutional investors pile into the precious metal market.

Gold for delivery in August, the most active futures contract trading in New York, touched a high of $1,423.90 an ounce level in early afternoon trade. If the metal can hold onto these levels it would be the highest close since May 2013.

The Commitment of Traders report for the week ending 18 June saw large-scale speculators like hedge funds increase their net long gold positions – bets on rising prices – by more than a fifth to 590 tonnes.

Bullish bets wagered by hedge funds are now at a 16-month high, after a record increase in net long positions over the past three weeks

Bullish bets wagered by hedge funds are now at a 16-month high, after a record increase in net long positions over the past three weeks of some 488 tonnes. This time last year gold futures speculators were net short – bets gold can be bought back cheaper in future – 317 tonnes of gold.

On Friday, investors poured a record $1.6 billion into SPDR Gold Shares (GLD), the largest physically-backed gold exchange traded fund. That was the largest inflow since the launch of the fund in 2004.

Gold bulls bought almost 40 tonnes of the metal on Friday bringing total holdings in GLD to just shy of 800 tonnes or 25.7m troy ounces, a third of the total held by the dozens of gold ETFs listed globally.

Graph: MINING.com Gold price $/troy ounce June 24, 2019

Number one for a day (or two)

Gold ETFs were credited for a big portion of gold’s uninterrupted 12-year bull run, because ETFs make it so easy to invest in the yellow metal. (And to cash out as gold’s 2013 annus horribilis so clearly showed.)

While launched a full 18 months after the first physically backed gold ETF was created in Australia, GLD quickly dominated the market.

GLD was listed on 18 November 2004 and enjoyed a pretty good first day. Investors bought just over 8 tonnes or 260,000 ounces of gold affording the fund a net asset value of $115 million.

In August 2011 when gold was hitting record highs GLD became the largest ETF in the world briefly surpassing the venerable SPDR S&P 500 trust’s net asset value

A mere two days later it would cross the $1 billion mark and by the time Thanksgiving arrived the following week gold bugs had snapped up more than 100 tonnes. The 1,000 tonne market would be crossed in February 2009.

On August 22, 2011 when gold was hitting record highs above $1,900 an ounce GLD became the largest ETF in the world briefly surpassing the venerable SPDR S&P 500 trust (assets today $265 billion) at a net asset value of $77.5 billion.

Gold holdings in the trust would peak more than a year later in December 2012 at 1,353 tonnes or 43.5 million ounces. Global ETFs hit a record 2,632 tonnes or 93 million ounces of gold at the time.

Those who got in on the GLD ground floor are enjoying returns of more than 200%. That handily beats the returns of the S&P 500 since November 2004, even as the index hits fresh all-time records.

First Quantum ships first concentrate from Cobre Panama

First Quantum Minerals of Toronto said the first shipment of copper concentrate from the $6.3-billion Cobre Panama project has left port. The open pit mine and mill, located 120 km west of Panama City, is owned 90% by First Quantum and 10% by Korea Mining Corp.

The first ship departed the Punta Rincon port at Cobre Panama on June 19, 2019, carrying 3,377 wet tonnes of concentrate. The second ship has already docked and will load about 44,000 wet tonnes of concentrate. First Quantum said it expects to make shipments every two to three weeks.

Cobre Panama is on track to produce between 140,000 and 175,000 tonnes of copper in 2019 as the ramp up continues. The goal is to produce 300,000 tonnes annually.

The mine has measured and indicated resources of 3.7 billion tonnes grading 0.37% copper and inferred resources of 1.1 billion tonnes at 0.26% copper. The ore also contains molybdenum, gold and silver.

This article first appeared in the Canadian Mining Journal

Wallbridge drills more excellent grades at Fenelon

Toronto-based Wallbridge Mining Co. is no stranger to high grades as the company continues to drill its Fenelon gold property 75 km northwest of Matagami. It is all there – high grades, visible gold and broadly mineralized intervals.

The 2019 exploration goal is to expand the known footprint of the mineralization and demonstrate the growing size potential. Here are some highlights:

  • Hole 19-0925-005A – 3.93 g/t gold over 20.7 metres, including 55.95 g/t over 1.24 metre in the Tabasco corridor;
  • Hole FA-19-054 – 3.61 g/t gold over 19.0 metres including 9.31 g/t over 2.83 metres and 6.19 g/t over 2.6 metres also in the Tabasco corridor; and
  • Hole FA-19-059 – 3.28 g/t gold over 17.6 metres (including 7.74 g/t over 1.83 metre and 72.35 g/t over 0.4 metre) included within a broad stockwork grading 1.02 g/t over 78.3 metres in the Area 51 corridor.

Wallbridge VP exploration Attila Penteck said the intersection of 3.61 g/t gold over 19.0 metres in hole FA-19-054 was a surprise. “Such significant mineralization has previously not been observed to be hosted by the sedimentary package at Fenelon, highlighting the fact that we now have multiple mineralization styles and host lithologies within the rapidly growing footprint of the Fenelon gold system.”

The company says underground drilling continues to intersect high grades at the Naga Viper zone. Highlights include:

  • Hole 19-0970-001 – 64.69 g/t gold over 0.5 metre;
  • Hole 19-1035-003 – 16.66 g/t gold over 2.3 metres; and
  • Hole 19-0985-003 – 17.93 g/t gold over 0.65 metre.

This article first appeared in the Canadian Mining Journal

How To Time Market Tops And Bottoms

 

June 23, 2019
Chris Vermeulen
TheTechnicalTraders.com

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Investors don't forget the great opportunities available with stock warrants:

 

Stock Warrants - Power Point Presentation

 

 

Summer Is Breaking Out And So Is Gold (Weekly Rap Up With Eric Sprott)

 

June 21, 2019
Chris Vermeulen
TheTechnicalTraders.com

Summer Is Breaking Out And So Is Gold (Weekly Rap Up With Eric Sprott)

Investors don't forget the great opportunities available with stock warrants:

 

Stock Warrants - Power Point Presentation

 

 

Investors don't forget the great opportunities available with stock warrants:

 

Stock Warrants - Power Point Presentation

 

 

Financial Sector Paints A Clear Picture For Trading Profits

 

June 21, 2019
Chris Vermeulen
TheTechnicalTraders.com

Financial Sector Paints A Clear Picture For Trading Profits

Investors don't forget the great opportunities available with stock warrants:

 

Stock Warrants - Power Point Presentation

 

 

FED Leaves Rates Unchanged – Gold Stocks Rally And Dollar Falls

 

June 20, 2019
Chris Vermeulen
TheTechnicalTraders.com

FED Leaves Rates Unchanged - Gold Stocks Rally And Dollar Falls

Investors don't forget the great opportunities available with stock warrants:

 

Stock Warrants - Power Point Presentation

 

 

Continental Gold drills visible gold at Buriticá; stock at 9-month high

Continental Gold Inc. (TSX:CNL) today announced assay results from initial exploration at its Buriticá project in Antioquia, Colombia. Visible gold was encountered in all four drill holes.

Highlights of the latest drill results include 44.90 g/t gold over 1.20m, 582.00 g/t gold over 0.50m and 47.20 g/t gold over 0.50m. The company points out that these intercepts are grading “significantly higher” than the current inferred mineral resource estimate for this target area.

Shares of Continental Gold jumped nearly 5% on Monday morning to a 9-month high of C$3.47. Its market capitalization stands at C$647.6 million.

The Toronto-based gold miner is currently in the process of completing a 73,500m definition and exploration drill program at Buriticá this year. Construction of the project was 67% complete as of May 31, 2019, and the first gold pour is earmarked for H1 2020.

The Buriticá project, with an estimated 3.71 million ounces in mineral reserves, has attracted the interest of major miners such as Newmont, which earlier this year backed the company with a $50 million financing.

Precious Metal BreakOut Or FakeOut

 

June 20, 2019
Chris Vermeulen
TheTechnicalTraders.com

Precious Metal Breakout Rally Or Fake Out

Investors don't forget the great opportunities available with stock warrants:

 

Stock Warrants - Power Point Presentation

 

 

Falling cobalt prices add fresh challenges to DRC’s economy

A dramatic fall in prices for cobalt, a key element in the production of electric vehicles (EVs) and the main commodity mined in the Democratic Republic of Congo, is forcing the country to speed up efforts towards diversifying its economy away from mineral resources.

Prices for the metal last summer exceeded $40 per pound, but have since declined to $12.70, according to MINING.COM Markets, hindering the DRC’s economic growth.

The situation is set to get worse as expectations of even poorer demand from the power battery market will extend the decline not only in prices for cobalt, but also for lithium.

Shanghai Metals Market

The Central African country generates about two thirds of the global supply of cobalt and it also is one of the top miners of coltan.

Mining, in turn, accounts for 80% of its export revenues, making the DRC economy extremely dependant on the prices of its main raw material shipments. According to a report by the International Monetary Fund released earlier this month, GDP growth in the DRC, one of the world’s poorest countries, is expected to fall to 4.3% this year from 5.8% in 2018, due to a slowdown in mining activity triggered mainly by lower cobalt prices.

In November last year, Prime Minister Bruno Tshibala and Mines Minister Martin Kabwelulu declared the commodity a “strategic mineral resource”. Through that decree, royalties on cobalt and two other minerals almost tripled to 10%.

Higher royalties, however, have not been enough to offset the decline in cobalt prices, especially as the market continues to get flooded by small-scale individual miners, who normally dig up the metal by hand and who react quickly to prices changes.

Another factor weighing on the commodity’s present weakness are, as reported by FT.com, increasing stockpiles of the metal at the port of Durban in South Africa and in China, and a cut in subsidies to electric vehicle producers in China this year, which has also reduced demand for batteries in the world’s largest car market.

According to Shanghai Metals Market, the situation is set to get worse as expectations of even poorer demand from the power battery market will extended the decline not only in prices for cobalt, but also for lithium.

While the current cobalt market is depressed, there’s still rosy views about the future. Automakers are still planning to roll out electric-car models and Glencore, one of the top producers of the coveted metal, could start clearing its cobalt backlog in 2020, by which time car sales are expected to start picking up.