Market Direction: The US market continues to grind its way higher almost every day. The ASX has been lagging in the past few sessions so I expect some catching up early this week. Outcomes resulting from the G20 meetings, held in Washington over the weekend are likely to influence markets early this week.
The biggest piece of economic news to watch for this week will be the US Advance Quarter GDP which comes out on Friday at 10:30pm AEST. This will once again bring a focus back onto the strength of the economic recovery underway in the US. Other key data out this week includes:
AUD PPI q/q - Tuesday 11:30am US Consumer Confidence - Wednesday 12:00am AUD CPI q/q - Wednesday 11:30am Ben Bernanke - The challenge of achieving fiscal sustainability - Wednesday 12:00am US Federal Funds Rate - Thursday 4:15am US Unemployment Claims Thursday 10:30pm US Advance Quarter GDP - Friday 10:30pm
The G20 meetings held over the weekend are likely to impact markets today. A focus is likely on Greece's troubles and what actions are going to be taken to help the struggling nation through its budgetary problems.
This week, 164 companies in the S&P 500 reports results, including Dow components Chevron, Exxon Mobil and Procter & Gamble. Ford Motor, Texas Instruments and UPS also report results.
I have added my price targets to my weekly stocks from this week however please note that these are based on my expectations after looking at past support and resistance levels on the charts so you need to form your own opinions prior to setting entry and exit levels for trades.
Sectors of Interest: Gold was up $18 per ounce on Friday so there should be some interest in that sector this week hence my inclusion of some .
CVY: With gold up nearly 2 percent on Friday night I expect interest to return to the sector today. Coventry finalized the $10m placement last week and is now well funded to carry out more extensive exploration at their Canadian gold projects. Drilling results from Ardeen should come through any day now which could be the catalyst for a move to the next resistance level of 30 cents. News Due: Drilling results from the Ardeen Gold Project in Canada. Conceptual studies into underground mining at Cameron Lake. Price Target: 30 cents once 25 cents gets broken convincingly. Support is at 22 cents. Disclosure: Holding CVY
OVR: Overland has had a decent retrace and will be worth watching for a price/volume breakout this week. The golden cross I have talked about where the 50day SMA crosses the 100 day SMA looks set to happen today or tomorrow. Hopefully we'll get some details of the 2010 exploration program from the company in the near future to stimulate interest in the market. The chart is giving mixed signals with the slow stochastic crossing up last Friday whilst the MACD crossed down and the RSI fell towards 50. Watch for a price / volume breakout above 10.5 cents for another attempt to break the 12.0/12.5 level. Friday's candle was a hammer which shows that the bulls were strengthening. I'll be watching for further confirmation of this today. News Due: Details of the exploration program for 2010 at the Yukon Base Metals Project in the Yukon, Canada. Price Target: A break of 12.5 cents on volume should see the stock heading towards the next significant resistance level of 30 cents. There might be a pause at 17.5 cents which was the high set in April last year, however, this is not a strong resistance level according to the chart. So the upside for OVR from current levels is 300%. Support should be strong at 9.5 cents. Disclosure: Holding OVR
BCN/BCNOA: Further drilling results from the Barlee gold project are due out now so I am watching BCN closely for an increase in volume as a sign of people taking significant positions in anticipation of good results. From a charting perspective BCN is oversold and is close to the bottom of the trading channel. Any significant results should see the share price quickly test the top of the channel at 3.4 cents which would represent a 26% return based on Friday's prices. News Due: Drilling results from the Barlee Gold Project. Price Target: The stock has been trading in a horizontal channel between 2.6 and 3.4 cents for the past 3 months. My price targets are 3 cents, which is a resistance level followed by 3.4 cents should that level be broken. Disclosure: Holding BCNOA
SVL: The company put out preliminary results from hole RC076 based on a Handheld XRF analyzer and the intersection was impressive with 12m @ 1901.3g/t Ag 2.6% Cu and 9.9% Zn. If these results are confirmed by lab assays then the stock should perform very strongly in coming weeks. On the chart there is a gap from 7.5 cents which was created after the announcement last week however unless there is bad news then it is likely to become a breakaway gap. The slow stochastic, RSI and MACD all look bullish with room for further rises in the near term. There is also likely to be a golden cross some time this week which could see the stock appear on more peoples scans. The company's cash reserves are quite low so there will no doubt need to be a capital raising soon so one must be mindful of this when taking a position. However it is worth noting that they tend to raise small amounts at a time, usually enough to fund their next drilling campaign, so I wouldn't expect too much dilution. News Due: Lab assay results from hole RC076 at the Webbs Silver Project in NSW. Price Target: 10.5 cents is likely to provide reasonably strong resistance in the short term however once that level is broken the next target is 14 cents. Support is at 8 cents. Disclosure: No Stock Held
