1. Bird flu has recently reared its ugly head in Indonesia where 2 more deaths were reported yesterday, Vietnam, and possibly Japan. Although this is unlikely to have much influence on Gold, some experts still fear the possibility of an epedemic or pandemic which would undoubtedly be Gold bullish.
2. Considering that Oil recently broken down from a 3 month-long consolidation, I find it surprising that Gold has not been weaker. On Friday, oil prices rebounded by more than $1, however, I think that the $57.50 to $58 level would now provide very strong resistance and I think that Oil is medium term bearish, although a bounce is now probably quite likely. The energy market has had a hard time maintaining rebounds lately, despite several factors that have given prices a boost in the past: the possibility of another OPEC cut, tensions in the Middle East, still somewhat strong global energy demand, and escalating violence in Nigeria.
3. Over the weekend, I spent some time with a friend who works at Merrill's commodity desk who told me he believes that energy prices may be range bound in the near future, but he was bullish going into next year. His top base metal picks were currently nickel and zinc. He does not cover precious metals.
4. On Friday, Yamana Gold Inc. (NYSE:AUY - News), transferred its listing from the American Stock Exchange to the more prestigious (and more selective) New York stock Exchange. I think this may be a positive move for Yamana as it may lead to increased overall trading volume and liquidity. Other major Gold companies listed on the NYSE include: Barrick Gold Corporation (NYSE: ABX - News), Goldcorp Inc. (NYSE: GG - News), AngloGold Ashanti Limited (NYSE: AU - News), Gold Fields Limited (NYSE: GFI - News) and Harmony Gold Mining Company Limited (NYSE: HMY - News). Silver Wheaton's (SLW) trading volume arguably increased after it transferred from the AMEX to the NYSE on May 9, 2006, though a part of that increase was also likely due to the continuing success of this company. The NYSE has a total market cap of about $25 trillion and a daily trading volume value of about $86 billion.
5. Yama had provided its 2007 and 2008 operating guidance following the closing bell the previous trading day. Gold production is expected to exceed 620,000 ounces in 2007 increasing to more than 800,000 ounces in 2008 from mines currently in production and mines under construction. Total cash costs will be a stellar -$114/oz in 2007 and -$185 in 2008 (i.e., Yama will be making additional money for each ounce of Gold sold as a result of copper credits).
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