Gold has traded between $1,140 and $1,149 so far today after hitting a fresh 4-week high yesterday…as of 10:00 am Pacific, bullion is down $8 an ounce at $1,146…Silver is flat at $15.13…Copper is at $2.29…Crude Oil has added 48 cents to $45.39 while the U.S. Dollar Index is relatively unchanged at 96.30…
Follow-through buying in Gold from yesterday, over the next few sessions, would suggest a near-term price uptrend in Gold can be sustained…chart resistance exists at $1,160, as outlined by John this morning, while the August high of $1,170 will also be a key level to overcome…
The U.S. economy expanded by 3.9% in Q2, according to the final estimate of GDP for that quarter as reported by the Commerce Department this morning…that figure was slightly above expectations…
“With the third estimate for the second quarter, the general picture of economic growth remains the same; personal consumption expenditures (PCE) and nonresidential fixed investment increased more than previously estimated,” the report stated…
Too Much Focus On The Fed
This is a problem the Fed itself has created with too many mixed signals and delays in pulling the trigger on the first rate hike in nearly a decade…a week after the Fed voted to keep interest rates at zero, Fed Chairman Janet Yellen said in a nearly hour-long speech yesterday (during which she became dehydrated and started having difficulty near the end), “It will likely be appropriate to raise the target range of the federal funds rate sometime later this year (our emphasis) and to continue boosting short-term rates at a gradual pace thereafter as the labor market improves further and inflation moves back to our 2% objective…if the FOMC were to delay the start of the policy normalization process for too long, we would likely end up having to tighten policy relatively abruptly to keep the economy from significantly overshooting its goals,” Yellen stated…
Central to the argument she set out to establish is a belief that slack in the economy has diminished to a point where inflation pressures should start to gradually build in the coming years (how long have we been hearing the same tune from the Fed?)…Yellen argued that those pressures aren’t asserting themselves yet, because a strong dollar and falling Oil and import prices (the #1 export out of China at the moment is deflation) are placing temporary downward pressure on consumer prices…as those headwinds diminish, she predicted, inflation will gradually rise…
Interestingly, central banks in Norway, Taiwan and Ukraine all lowered interest rates this week…the central bank of India appears on track to cut rates, too…meantime, investors have piled into European bonds, anticipating the ECB will launch a new bond-purchase program to boost the euro zone economy and inflation…other central banks that might have responded to a Fed rate increase with upward moves of their own – including those in Mexico and Turkey – instead this week opted to keep rates on hold…
Brazil In A Downward Spiral
After more than a decade of socialist rule, the wheels have fallen off the wagon in Brazil which is rapidly becoming the Greece of Latin America…Brazil’s battered currency yesterday touched a new low, unemployment surged and the central bank forecast a far deeper recession – a litany of woes suggesting a major crisis ahead for this once high-flying economy…the real, the worst performer of any major global currency in 2015, has lost around one-third of its value this year…the country’s central bank, which said it may dip into its $371 billion in reserves to stem the currency’s bleeding, lowered its 2015 forecast for a 2nd time yesterday and now predicts the economy will shrink 2.7% this year – the worst contraction in 25 years…
Gold 6-Month Daily Chart
With Gold’s 50-day moving average (SMA) possibly readying itself for a reversal to the upside, the odds do seem to favor bullion gaining further momentum into October with at least another test of its 200-day SMA (currently $1,180) as was seen in May and June…so any minor weakness in Gold could be a strategic time to accumulate some high-quality producers and juniors…
Next resistance is clearly $1,160 as shown on this 6-month daily chart…very dramatic reversal in the CMF…
Yesterday, we noted how some fresh accumulation of Gold by ETF funds is long overdue, and that’s one factor that could give bullion some strength during Q4 going into year-end…a trend that is quite evident is the slowing liquidation of Gold ETF holdings as noted in this chart below…
Frank Holmes, CEO of U.S. Global Investors, expects demand for Gold to be led by China:
“The decline of the Chinese real estate market moved billions of dollars into the country’s stock market, which saw a dramatic rise and then an equally sharp decline. If Chinese investors fleeing from stocks decide that the historic value in Gold is tempting, that could mean the next boom could come in Gold.”
TSX Gold Index Long-Term Chart
The TSX Gold Index, which is currently down for the 5th straight year, is well-positioned to snap that losing streak with a strong 4th quarter move to the upside…one important clue regarding that is obvious in this 15-year monthly chart – the rather sharp divergence between RSI(14) and price since 2014…RSI(14) has been climbing an uptrend line since the beginning of 2014 while the Gold Index plunged recently to lows not witnessed since 2001…
Next resistance is 135 while the downtrend line from the 2011 high currently intersects around 150…a break above the downtrend line would likely kick off a wave of fresh buying interest…
The Gold Index is off 2 points at 127 as of 10:00 am Pacific…
Richmont Mines Inc. (RIC, TSX) Update
Some high-quality individual producers have performed remarkably well the last couple of years despite the pressure on the overall Gold sector – bullion and stocks…and keep in mind, Gold in Canadian dollars is trading above $1,500 and looking very bullish…
Our favorite Canadian producer remains Richmont Mines (RIC, TSX) which has become an earnings machine and will also soon benefit from the high-grade resource discovered beneath existing workings at its Island Gold mine in northern Ontario…
RIC has been trading within a downsloping flag throughout 2015…we predict a breakout above this flag during Q4 and a move toward the next measured Fib. resistance which is $5.48, 40% above current levels…
Today’s Equity Markets
Asia
China’s Shanghai Composite closed down 51 points overnight to finish the week at 3092…meanwhile, Japan’s Nikkei rallied late in the day for a gain of 309 points or nearly 2%, closing at 17881…market watchers attributed the rally to speculation that the Bank of Japan will be stepping up its easing at its October policy meeting…core consumer prices dropped 0.1% in August, turning negative for the first time since April 2013…
Europe
European markets were up sharply today, around 3%, as concerns over the health of the global economy dimmed slightly after Janet Yellen suggested the Fed was still on course to raise interest rates by year-end…
North America
The Dow has climbed 218 points as of 10:00 am Pacific…
On the political front, a shocker out of Washington, D.C., as it was announced this morning that House Speaker John Boehner, under pressure from some in the conservative wing, will resign from Congress at the end of October…the announcement came just a day after the high point of Boehner’s congressional career, an historic speech by Pope Francis to Congress at Boehner’s request…
In Toronto, the TSX has added 108 points as of 10:00 am Pacific…the Canadian dollar is relatively flat after hitting its lowest level yesterday since June 2004…Bank of Canada Governor Stephen Poloz, who already cut interest rates twice this year, has said he expects exports to take over from consumer spending as the main driver for the next stage of Canada’s economy recovery, with non-commodity exports to lead the way…
The Venture is unchanged at 544 as of 10:00 am Pacific…keep an eye on Athabasca Nuclear (ASC, TSX-V) which is looking strong technically and has strategically positioned itself in the Garland Nickel camp play…ASC is up a penny at 4.5 cents through the first 3-and-a-half hours of trading…
Discovery Ventures Inc. (DVN, TSX-V) Update
Discovery Ventures (DVN, TSX-V) has enjoyed another good week…it’s up a penny at 17 cents as of 10:00 am Pacific…that’s a key Fib. resistance level that DVN has an excellent chance to overcome given the bullish “W” in the RSI(14), along with increasing volume and up momentum…the fundamentals are looking good as we’ve been impressed with the steps taken so far by new CEO Dan Omeniuk, a successful entrepreneur out of Winnipeg, with regard to the company’s high-grade Willa-Max Gold-Copper Project in southeast British Columbia…
Integra Gold Corp. (ICG, TSX-V) Update
If you’re bullish on Gold for the 4th quarter, keep an eye on Integra Gold (ICG, TSX-V) which is ramping up drilling in a big way at its Lamaque South Project in Val d’Or after a recent investment by Eldorado Gold (ELD, TSX)…great support at 27 cents which is the 50-day SMA and a Fib. level…band of resistance between 28.5 cents and 30 cents…balance of probabilities favors a breakout to the upside and another test of resistance near 40 cents…
ICG is off half a penny at 28 cents as of 10:00 am Pacific…
Note: Jon holds a share position in DVN.
Integra is an interesting play. They already have a PEA with good figures. The recent round of drilling has expanded the deposit and an updated 43-101 and PEA will be out soon. Further drilling (100,000m) starting in Jan with possibly 10 drills should expand and define the resource ready for a PFS due next year. They could be in production in 18 months time as they have a mill and nearly all permits in place.
I think Eldorado will buy them out at some point. There could be a few million ounces that is economical to mine in the old Lamaque mine that they acquired with the mill last year. I like the potential for this stock for several reasons.
Comment by Tom UK — September 25, 2015 @ 9:17 am
TomUK – I agree, ICG is a good play. Seems a few more are coming along as we get into fall.
Comment by dave — September 25, 2015 @ 10:10 am
Has anyone spoken to Farshad lately? I can’t seem to get a hold of him. I wanted to hear if we have a date for the Supreme Court hearing and/or a time frame as to when we can expect some news?
Comment by ChetBaker — September 25, 2015 @ 11:03 am
Dave, no 16 for you, and how many days in a row now over a mil shares, continue to be nice to your contacts, it’s working.. Ha!
Comment by Tombc — September 25, 2015 @ 11:35 am
All is quiet Chet . You and me and a lot of other people would like to know the same thing . Have we got a court date? It’s close to that three week waiting period many have been talking about.
Comment by Les — September 25, 2015 @ 12:23 pm
Red Chris blockade September 29 and October 14 the injunction stop the blockade !What is the problem with DBV??? Why GGI don’t begin drilling ?????
Comment by Guy Delisle — September 25, 2015 @ 12:36 pm
Guy, you’re asking 2 very different questions, and one isn’t related to the other. DBV is going thru a court process to get an injunction. This process can take as little as 21 or so days, or sometimes a bit longer. Let the process play itself out. As far as GGI goes, they will drill as soon as they have identified the best location for a potential discovery. Our sources in the district are confirming some intense activity on the ground at Grizzly Central, consistent with GGI’s last news that stated they are moving aggressively toward drilling. I suspect final geophysics are being carried out, and then it’s drill time – regardless whether DBV has an injunction or not.
Comment by Jon - BMR — September 25, 2015 @ 1:03 pm
I am certainly high on GGI and Grizzly Central but again they fail to give SH some sort of timeline on drilling. How many times do shareholders have to let Regoci know that his strategy is not helping the SP. The SP should already have been in the teens given the chances of a hit and what they have discovered. Poor promoters in my opinion. Not anything like Kyler Hardy. Too bad.
Comment by Dan1 — September 25, 2015 @ 1:05 pm
Dan, I’m sure Regoci has his plan. Watch it play out. This is a CEO who took his stock from a nickel to 32 cents in a year in a ho-hum market and made a discovery on the first hole at Rodadero. Did a financing at 21 cents. So compared to most CEO’s on the Venture, even Kyler, he knows what he’s doing. Be patient and watch what unfolds is what I suggest. He has an incredible opportunity to make national headlines if he hits the sweet spot in a known mineralized corridor at Grizzly Central, so they are being extremely careful in how they are selecting these first targets. It’s a very different situation, different dynamics on the ground, than out at Garland.
Comment by Jon - BMR — September 25, 2015 @ 1:09 pm
Jon, I think we have been very patient. I am not saying they won’t hit, but be a little more enthusiastic and open like EQT CEO. Promote a bit. If the SP were higher, then chances are it would go even higher on good news.
Comment by Dan1 — September 25, 2015 @ 1:12 pm
I hear you Guy . Im wondering if they are having to track Chad Day down to serve him . He may be trying to be hard to find because a locomotive with Farshad in the drivers seat is bearing down on him , this my be the reason why we haven’t heard a court date. I’m thinking we will be hearing something soon . JMHO
Comment by Les — September 25, 2015 @ 1:13 pm
Jon I’m not sure that This is a CEO who took his stock from a nickel to 32 cents I think that it is DBV speculation who bring GGI at this level !
Comment by Guy Delisle — September 25, 2015 @ 1:17 pm
Dan, I’m pretty sure Regoci knows what he has to do. It’s all about timing. And I’m sure he’ll pull the trigger at exactly the right time.
Comment by Jon - BMR — September 25, 2015 @ 1:18 pm
Guy, DBV’s discovery in early 2014 helped everyone in the district in the early part of the year. The facts are that DBV made an important discovery, Farshad pushed hard, and Garibaldi also pushed hard on bringing awareness to the entire district as the record shows they were the only company that actually hired an IR firm (MarketSmart Communications). And it wasn’t the Sheslay district that ultimately took GGI to 32 cents. On May 14, as DBV collapsed on news and the Sheslay district cooled off for a considerable period of time, GGI started working its way even higher on the Rodadero discovery, and 2 months later hit the low 30’s. Anyway, my point is, just as one should not underestimate Farshad, do not underestimate Regoci. And if GGI hits at Grizzly Central, everyone wins – not only will GGI soar, but DBV will take off as well.
Comment by Jon - BMR — September 25, 2015 @ 1:29 pm
Martin, have you heard anything from Walker River “WRR” camp regarding drilling of their six high grade gold targets in Nevada?
Have you actually started drilling yet?
Comment by Jeff — September 25, 2015 @ 2:06 pm
Hello gang – I would have to agree with Jon on GGI. It is rare for a company to hit the sweet spot on the first hole out, but GGI and EQT have good odds. Its important to take the time needed and line everything up properly. Interpreting ground work is like mri imaging. It is complicated sometimes and requires time to size it up so you drill in the right spot. I do feel Kyler is good at keeping the the people informed more than Regoci though and has done more than Regoci. Nonetheless, patience may pay off for GGI.
Tombc – yup,yup, got the call wrong today as she closed green.
2 things to remember here.
1. she can go red Monday and test .165 still and would still not violate the triangle pattern. BUT if it does, it will be its last red day as Wednesday the lines cross on the apex.
2. a stock can break out prior to reaching the apex as there are no written laws on this.
So, with the PP supposedly closing Monday, I’m going to stick my neck out and make a green close with a breakout to follow.
The triangle is a very strong chart pattern that holds true almost 100% of the time. It is considered a continuation pattern of the current trend (up), and strong breakouts occur with them. You can google symmetrical triangles of coarse and study up on them. Very interesting chart pattern.
Comment by dave — September 25, 2015 @ 2:16 pm
Good question on WRR Jeff. No news release that drilling actually started on the 21st. This CEO never talks and you never really know whats going on. Its a shame because they have an excellent land package.
Comment by dave — September 25, 2015 @ 2:21 pm
Jeff good volume today on WRR !
Comment by Guy Delisle — September 25, 2015 @ 2:22 pm
Michel David is not a promoter, it is a geologist he told me the result made the best promotion !
Comment by Guy Delisle — September 25, 2015 @ 2:28 pm
Guy – the CEO has to be able to promote and leave the Geology to the rest of his staff. That doesn’t mean that he himself is not a geologist, but getting the story out there is important.
Comment by dave — September 25, 2015 @ 3:18 pm
My guess is that GGI will start drilling before they issue a NR. That will settle a lot of nerves amongst investors when it comes through, maybe next week? Regoci is getting criticism and disbelieved because he promised a good news flow for the early part of the year which did not happen. A month or so ago he made a similar promise and I believe on this occasion we will get some news from both Grizzly and Mexico.
Comment by Tom UK — September 25, 2015 @ 3:50 pm
People are comparing EQT and GGI and the differing styles of the CEOs. I’ve just a quick look at the number of shares traded by both companies in the last 30 days. A quick tot up in my head shows that EQT has practically turned over 100% of it’s shares whereas GGI has done about 5%. Hopefully both will hit good grades and it will be interesting to see how the SPs behave after drill results are released. That is when we will see how good they are at promoting their stock i.e. with hard facts.
Comment by Tom UK — September 25, 2015 @ 4:00 pm
I’m hoping so TomUK
Comment by dave — September 25, 2015 @ 4:08 pm
I would like to think, Tom, that GGI will want to build some anticipation and excitement just before starting to drill, so I’d be surprised and disappointed if they just started drilling and then came out with news. So I do expect some more noise, probably any day now, in advance of drilling. Regoci I’m sure will play this smart. I’m not making excuses for him, but yes, he was off in his call for more news flow earlier, but keep in mind he got blindsided by Chad Day (the equivalent of a “hostage” taking incident), Sprott and then the July-August Venture slide, all wrapped into one. That would alter anyone’s best intentions and plans. The critical thing is, he’s gotten the company to the drilling stage at the Grizzly and that’s going to give shareholders immense potential leverage. He deserves credit for that, and if he pulls off a discovery, he’ll be everyone’s hero.
Comment by Jon - BMR — September 25, 2015 @ 4:09 pm
The work they have done at the Grizzly this year has increased their chances of a good hit very early on. I have been frustrated by the lack of news, but very happy that we are now in the position that we find ourselves. That last NR they gave looked to me like the final NR before drilling commenced, but I bow to your better knowledge of how Regoci might play this.
Comment by Tom UK — September 25, 2015 @ 4:24 pm
Maybe Jon could contact WRR and find out if we are close to drilling? It’s been a long awaited, now fully paid, program! So, it should be exciting once it starts!
Comment by STEVEN1 — September 25, 2015 @ 4:25 pm
Simple math is in Garibaldi’s favor, Tom. You have a mineralized structural corridor with 2 deposits already defined, a 70% drill hole success ratio in the district (based on about 90 holes), and similar geological, geochem, and geophysical signatures at Grizzly Central as seen over other successful drill holes (and deposits) within a few to 10 km away. GGI has the district keys to open the door at Grizzly Central. Unusually high discovery odds. I have to emphasize, you don’t see this very often in this business. There’s an obvious path here, but it’s not as simple as just poking a few holes into the ground. Where precisely they go, at what angle and in which direction, those are critical and not easy decisions – especially when you’re aiming to make an early discovery on the first few holes. Having said that, DBV, with much more limited knowledge back in 2013, made the Lisle Zone discovery on hole #8. My guess is, if Grizzly Central is indeed “pregnant” like other areas in the district, GGI can make their discovery much more quickly and in half the # of holes it took DBV in 2013.
Within 4, they score. And then the national spotlight shines on this district.
Comment by Jon - BMR — September 25, 2015 @ 4:40 pm
Dave, you are right about Walker River CEO not promoting his company.
I hope John can find out if the company has started drilling their six target high-grade gold prospect in Nevada.
Comment by Jeff — September 25, 2015 @ 9:33 pm
Macquarie has slashed its copper price forecasts. The bank sees average prices at $5,663 for 2015 and $5,713 for 2016. It cut its fourth-quarter price forecast expectation by 6.8 percent to $5,500.
“We see copper at around $5,500 (by year-end) but that should be as good as it gets,” said Carsten Menke, analyst at Julius Baer.
The dour Chinese outlook is spurring hope in some quarters for stronger stimulus from Beijing, but even those hopes are blighted by poor growth prospects in emerging markets.
Comment by ConcernedCitizen — September 26, 2015 @ 2:00 am
I think a news from DBV this week !
Comment by Guy Delisle — September 26, 2015 @ 5:53 am
New from GGI to, Guy sold wrr to be all in GGI!
Comment by Martin — September 26, 2015 @ 7:11 am
Interesting, ConcernedCitizen. We saw a couple of firms come out with quite an opposite take on Copper going into the balance of the year. The metal is quite sensitive to production cuts and supply disruptions, so we’ll see what happens.
Comment by Jon - BMR — September 26, 2015 @ 7:13 am
Jon- A quote from Kyler Hardy, on another board, refers to 1.6% Ni equates to $18,000 US per ton of ore extracted, does this seem correct to you?
Comment by Bob — September 26, 2015 @ 7:33 am
Guy, I doubt we will have news from DBV and if we do it unfortunately won’t be what we all want the most…..drilling.
I said a while ago when rumours were circulating about drilling soon that DBV wouldn’t be drilling before the end of the month and we would very very lucky if we did. I think we are still weeks away from drilling……
Comment by DDD4 — September 26, 2015 @ 7:59 am
Guy , DBV will need the get the court hearing and decision before they resume drilling . I’m hoping for news of a court hearing date or a decision in DBV’s favour.
Comment by Les — September 26, 2015 @ 8:37 am
I read that Glencore is in a $30 Billion hole (Xstrata fusion consequence) and is flooding New Orleans with zinc (which they’re selling at a loss since they banked on zinc prices rallying?) so they’re ferreting out copper properties and cutting output.
Chilean earthquakes, Zambia power outages, & Glencore cuts taking out 1.5 million tonnes yet Goldman Sachs forecast a 500,000 tonnes surplus.
“Rough rule of thumb though this may be, the recent slide in copper to near $5,000 a ton would indicate Chinese growth may be much closer to the 5 percent level than the 7 percent the official figures suggest.”
Nobody takes the 7% growth figure seriously. Put the pedal to the metal China.
Meanwhile a nickel deficit is looming. Could see nickel defying the overall commodity trend.
Comment by ConcernedCitizen — September 26, 2015 @ 8:41 am
I have heard the same thing about nickel which bodes well for EQT.
WRR issued a NR on 09-16 saying that the drilling would start on the 20th. However, I would think that they would issue another NR on the 20th CONFIRMING that it in fact started. The CEO is way to quiet and non-aggressive. What, we are suppose to assume that he is drilling and all of a sudden one day a NR comes out with the results. It had some decent volume Friday and the asks are getting thinner and it may move up and make some money for some people. I just don’t like putting my money in a mickey mouse act. If the results come out and they are good, I can buy then if I think she is gonna run some.
Comment by dave — September 26, 2015 @ 9:40 am
Interesting – Eqt – stockta shows that it went from Nuetral-Nuetral-Bullish on Thursday to NOW Bullish-Very Bullish-Bullish after Friday’s close.
The support went from .16 to .17 with a stronger support number and the resistance at .20 has lowered with a lower number.
Maybe rock and roll this week.
Comment by dave — September 26, 2015 @ 9:51 am
Bob – I can help John on your post #33. YES, it is correct. And if EQT where to pull a 3 to 4% hole, I’ll faint.
Comment by dave — September 26, 2015 @ 9:57 am
Dave, rock and roll this week with EQT, lets hope so. One thing is certain, the drill is turning and by the time the market opens on Monday they will possibly be on the second hole. Any hint of massive sulfides and look out! What would be nice is if they did the same thing as Noront, put picks on their website of the drill core if they hit.
Comment by Dan1 — September 26, 2015 @ 11:06 am
Dave -thanks, guess that is another reason why they have garnered such interest from those
with funds to invest. Consider gold @ 6 gm/ton (hi-grade), @ $40/ gm is only $240 per ton of ore.
Comment by Bob — September 26, 2015 @ 11:07 am
Bob – it’s the grade that makes the difference.
Dan, keep in mind they have been having a lot of morning fog that could not give a full day of drilling in. Maybe we do hear something this week. This next breakout should take it past the Fib. 23 level.
Comment by dave — September 26, 2015 @ 12:12 pm
Bob (posts 33 and 41) and Dave (post 39)- I think that apples and oranges are being compared here- $18000 must be for a ton of separated nickel- 2000 lbs @ $9/lb= $18000, and I don’t think nickel is anywhere near that $9/lb now; meanwhile the reference to gold was for unprocessed gold bearing ore.
Comment by Terry — September 26, 2015 @ 7:23 pm
Terry- I agree, how could ore have such a high value? But, if you look at the May 17th Youtube video, K. Hardy interview, @ 3 minute mark,it
states this high #. Perhaps just another video editing faux-pas.
Comment by Bob — September 27, 2015 @ 2:34 am
Terry – You have a point there. Don’t know how Kyler came up with that figure than, but a 1.6% intercept is a decent hit. Good to see you on the board here.
Comment by dave — September 27, 2015 @ 6:02 am