Issue link: http://resourceworld.uberflip.com/i/937377
F E B R U A R Y / M A R C H 2 0 1 8 www.resourceworld.com 25 At the Market by Rodney Blake I t took over 10-months – but on the last trading day of the past year – the TSX Venture Exchange finally rose to a new 2017 closing high of 851. Not great when compared to the 2017 20% plus gains of the American major markets, but at least a yearly gain of about 11.7% for the world's foremost junior resource mar- ket going into 2018. And almost a double from the record low of 466 set just two years ago in January 2016. As we entered 2018 I mentioned a few things that, other than seasonality, would be key for the Venture Exchange to have another good year ahead. One was for gold bullion to once again rise above its previous year's high of US $1,325/oz. Another was for crude oil to break out of its $40 – $60/bbl trading range and to finally establish a new floor somewhere over US $60/bbl. As if on cue, gold rose to US $1,325/oz in the first week of the year and crude oil rose up through US $64/bbl in the second week. And the once lowly Venture Exchange surged up by 75 points or 8.8% to a new three-year high of 925. Now the question remains – will the resource sector flame out in the first few months of the year and then drift lower as it did in 2017? Or is 2018 when com- modities keep their momentum going throughout year? To achieve this in the next few months a few things are critical. First, the price of gold and oil must hold their early gains and hopefully move still higher. Secondly, we need the other lagging commodities such as silver, natural gas and uranium to finally break out of their multi-year bear markets. Thirdly, all markets need increased trading volumes to move higher and the trading volumes on the Venture Exchange have risen nicely from about 250 million shares a day of last summer to the recent 400 mil- lion share days of early 2018. If this were to happen then, for the first time in years, the resource sector would have a multi- facet front to keep investors' attention and advance the market. The elephant in the room or caveat for a good year might be the new lithium/cobalt, cryptocurrency/Blockchain and marijuana sectors that seem to be taking a bigger part in driving the junior index higher. Some former junior mining issues have recently risen by great multiples just because they announced that they are going to grow mar- ijuana or enter the Blockchain sector rather than explore for minerals. These issues could turn down just as hard and fast as they went up should there be any negative events in these relatively untested sectors. So far – 2018 is off to a good start. The next few months may well dictate if we're off to a good year. n Rodney Blake is an Investment Advisors 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 believed to be reliable, but the accuracy and complete- ness of the information is not guaranteed, nor in providing it does Rodney Blake, 2018 – A very good start continued on page 95