Gold and Gold Equities Nearing Completion of Corrections

· Gold has broken out of an 18-month inverse head and shoulders pattern that measures to a technical target of $1,500+.

· Gold incurred similar breakouts of multi-month consolidations into Q4/2005 and Q4/2007 that lead to spring blow offs in 2006 and 2008.

· Each of these previous spring blow offs for gold incurred a 2-month flat correction mid-way through the advance. During these 2 previous consolidations for gold, the Gold Bugs Index (HUI) incurred a 2-month ABC zig-zag correction. (Exhibits 2 to 5)

· We believe gold is near completion of another sideways 2-month correction as it reaches a potential double bottom at its rising 100-day moving average. (Exhibit 6)

· The HUI has reached the bottom support line of its year-long ascending parallel channel and 200-day moving average as it completes another ABC zig-zag correction. The GDX (Market Vectors Gold Miners) has identical technical structure and the volume patterns are indicative of a bottoming formation. (Exhibits 7 and 8)

· The US Dollar index has rallied to its falling 40-week/ 200-day moving average. (Exhibits 9 and 10)

· After correcting since early December, we now find the risk/reward from a technical perspective extremely compelling for the following S&P/TSX 60 constituents:

· Barrick Gold Corp. (ABX – TSX $38.66)

· Agnico-Eagle Mines Ltd. (AEM – TSX $56.97)

· Eldorado Gold Corp. (ELD – TSX $14.03)

· IAMGold Corp. (IMG – TSX $15.39)

· Kinross Gold Corp. (K – TSX $18.84)

· Yamana Gold Inc. (YRI – TSX $11.36)

· We continue to anticipate a spring 2010 intermediate top for gold that should at minimum reach $1,500. We believe that the current pullbacks are near completion and present a quality opportunity to accumulate gold and gold equities.