Resource World Magazine

www.resourceworld.com 21 F E B R U A R Y / M A R C H 2 0 1 4 AT T H E M A R K E T R o d B l a k e A s we enter 2014 I keep finding myself studying charts of the TSX Venture Exchange, and by extension, charts of most of the junior resource stocks that I follow. And by studying, I probably mean staring, as for the most part I am dumbfounded as to what I am looking at. I can't remember when I've seen so many charts that look the same. It's as if someone took a photocopy of one chart, and then to save time and expense, they just put other names to it. These chart patterns are all so similar that I'm sure sometime in the future that market technicians and investors will look back at 2013 as a year that stood for the invincibility of the junior resource sector. Let me try and explain. What I'm seeing is chart after chart of resource companies that peaked sometime in early 2011 and then started a long two-year bear market slide to about April of 2013. And while there were a few bear market rallies such as in the first few months of the New Year, the bear market slide was deep and relentless. In the case of the TSX Venture Exchange, which again, represents most junior resource issuers, that peak to bottom slide was some 63% or 1,545 points from about 2,465 in March 2011 to just 920 in April of 2013. From there, the Venture Exchange, and by inference most junior issuers, held their ground and established a tremendous sideways congested range bound pattern that extended for over eight months through the end of 2013 and into early 2014. This range-bound pattern has three times tested bottoms down to about 900 and then tried to break out over 970 four-times in that period, only to be met with great selling resistance and get pushed down once again. It is only now, in mid-January, that the Venture Exchange looks to be taking a fifth and perhaps final push up through 970 and perhaps beyond. If this New Year's rally should finally break through and 970 and this then holds as a support level, we could be looking at the beginning of the next short-term bull market for resource issuers. And if the rally continues on through the first quarter of the year, then we may be looking at the start of a long overdue cyclical bull for the resource sector. There are only a few times in your life when you really feel that you are right, like when you meet that special someone or buy that perfect home, and I really think this is one of them. God knows, that after being wrong about the markets for most of the last three years, this sudden change of outlook is testing my sensibilities to the max. But I tell you, if I had a million dollars, I wouldn't just be buying more Kraft dinner. Rodney Blake is an Investment Advisor with Canaccord Genuity Wealth Management, a division of Canaccord Genuity Corp., Member Canadian Investor Protection Fund. The information contained in this article is drawn from sources belivied 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 sub - sidiaries, or affiliated companies, assume any liability. This information is current as the date appearing in this article, we do not accept assume any obligation to update the information or advise on further develop - ments relating to these securities. This article should not be considered personal investment advice or solicitation to buy or sell securities. Canaccord Genuity or 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 Genuity Corp. Rodney Blake can be reached at 604- 643-7567 or rod.blake@canaccord.com n If I had a million dollars "There are only a few times in your life when you really feel that you are right...I really think this is one of them."

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