July 1 Market Alert - Gold On The Move, And Stocks To Watch

Gold, which climbed to its highest level today in two-and-a-half months ($948.50 on the August contract) has now clearly broken out technically and appears poised to challenge its record high set back in March of just over $1,000 per ounce. We’re not sure if it will blast through to new highs on this particular move, but we believe it’s only a matter of time - perhaps six to 10 weeks - before gold makes a dramatic move to $1,200 and beyond. In fact, we’re already on record here stating that gold will hit $1,500 by year-end. The reasons are obvious: Continued U.S. dollar weakness, rising crude oil prices, inflation and geopolitical concerns, and overseas demand.

The TSX Venture Exchange has risen sharply the last three trading sessions - 101 points or 4%. It’s possible this could be the genesis of a major new Venture Exchange bull market, so we need to watch this Index closely in the coming days and weeks for additional clues and confirmation. We will expand on this subject in the near future, but a critical resistance level on the Venture Exchange is 2,700 which represents the 200-day moving average. A clear move through 2,700, on impressive volume, will likely mean that a bull run has been born and the “disconnect” that we’ve seen between the gold price and the junior gold stocks for many months is drawing to a close.

Some of our favorite gold stocks at the moment are as follows (and some of these we will be featuring in greater detail in the weeks ahead): Yamana Gold (YRI), Eldorado Gold (ELD), Kodiak Exploration (KXL), Pediment Exploration (PEZ), Canplats Resources (CPQ), Capital Gold (CGC), Rainy River Resources (RR), Lake Shore Gold (LSG), Goldquest Mining (GQC), Coral Gold (CLH), Explor Resources (EXS), Sage Gold (SGX), and last but certainly not least, our 15 cent special with huge upside potential - BacTech Mining (BM). We suggest you do your own diligence and watch these stocks carefully in the days and weeks ahead.

We are extremely bullish on silver as well, and commodity prices in general. We will be providing our thoughts and recommendations in those areas in the near future as well.