Issue link: http://resourceworld.uberflip.com/i/107613
at t he mar k et Rod Blake Cautiously Optimistic I 'm starting 2013 cautiously optimistic that the long term bull market in resources, and by extension, resource stocks, will get back on track. But, after two years of being overly enthusiastic and having my head handed to me after an initial early year rally, this time, I'm going to wait until about the end of April to gauge, if in fact, the long anticipated reemergence of the bull is back. Just to recap, you may recall that the long term resource bull market that began in early 2009 was killed in early March, 2011 by the devastating Japanese tsunami, with the resulting recovery rally of 2012 knocked off track in early March when gold bullion failed to reach the highs of US$1,900 an ounce established one year earlier. Meanwhile, daily trading volumes on the TSX Venture Exchange, the best market for tracking the performance of resources, fell from well over 200-million shares a day to barely 100-million shares a day by midsummer as continued worries of an European recession and an economic hard landing for China weighed heavily on investor sentiment. Then, except for a small, false rally last fall, the Venture Exchange remained depressed through year end, mainly due to tax loss selling and all of the talk of the US Fiscal Cliff, finishing 2012 down by some 17%. Now, as usual, the New Year brings renewed optimism, if only short lived. The TSX Venture Exchange, as I write, has gained some 65-points from its lows of 1,174 in December to about 1,240 and trading volumes are edging back up again towards that all-important 200-million shares a day level. Looking at a chart, it's encouraging to see that the Venture Exchange seems to have established a double bottom base that spanned the last six months of 2012 from which to build, or at the very least, to establish a floor under the resource markets. All of which bodes well for the start of 2013, but is it enough to get this tentative bull market past the first quarter that has marked the top of the resource market for two years running? That will be the real test. Can this resource market keep rising beyond the first quarter, or will it turn, and once again, leave a very fragile investors' confidence in its wake? Don't get me wrong. I still feel the very long term secular bull market for resources is intact, and over the long haul, higher resource prices and markets are yet to come. It's just that after two years in a row of seeing the market get severely sidetracked after the first quarter, I'm exercising a little more caution. n Rodney Blake is an Investment Advisors with Canaccord Wealth Management, a division of Canaccord Genuity Corp, Member-Canadian Investor Protection Fund. The information contained in this article is drawn from sources believed to be reliable, but the accuracy and completeness of the information is not guaranteed, nor in providing it does Rodney Blake, Canaccord Genuity Corp, or its subsidiaries, or affiliated companies, assume any liability. This information is current as of the date appearing in this article, we do not assume any obligation to update the information or advise on further developments relating to these securities. This article should not be considered personal investment advice or a solicitation to buy or sell securities. Canaccord Genuity and holdings of its respec-tive directors, officers and employees and their associations, from time to time may buy or sell any securities mentioned herein. The views expressed are those of the author and not necessarily those of Canaccord. Rodney Blake can be reached at 604-643-7567 or rod.blake@canaccord.com TSX : V.DMI OTCQX : DMIFF Strategic Alliance with World Famous Tiffany & Co. Near-Term Producer of Quality Diamonds www.diamcormining.com february 2013 www.resourceworld.com 25