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Gold has traded between $1,113 and $1,124 so far today…as of 9:00 am Pacific, bullion has retreated $10 an ounce to $1,116 after yesterday’s push to a 3-week high through a band of resistance between $1,100 and $1,110…we’ll see if $1,110 holds as new support while the next major resistance is around $1,150 (see updated chart below)…Silver is off 7 cents at $15.47…Copper is down a penny at $2.33…Crude Oil has fallen $1.03 a barrel to cents to $42.27 while the U.S. Dollar Index has gained one-tenth of a point to 96.45…

World Gold demand fell to a 6-year low of 914.9 metric tons in the 2nd quarter, a decline of 12% from the same period a year ago, the World Gold Council (WGC) reported today…the decline was blamed largely on less buying from the 2 largest Gold-consuming nations of China and India, according to the quarterly Gold demand trends report…otherwise, demand in Europe and the U.S. grew…the WGC said buying prospects for the remainder of the year are “more encouraging” as consumers respond to the recent price drop…meanwhile, and this is significant, global mine supply fell 5% year-on-year in Q2…

By country, China was the world’s largest overall consumer in the second quarter, buying 216.5 metric tons, although this was a year-on-year decline of 3%…India was in second place at 154.5 tons, a year-on-year decline of 25%…

Youth Finds 17.6-Ounce Gold Bar While Swimming – Turns It Into Police

A teenager has made an unexpected find while swimming in a lake in the German Alps: a 500-gram (17.6-ounce) bar of Gold worth nearly $20,000 U.S….police said yesterday that they are still trying to figure out where the bar comes from and how it got into the Koenigssee lake, a popular tourist destination near Berchtesgaden on the border with Austria…the 16-year-old girl, who was on vacation and probably should have saved the Gold bar for her college fund, found it around 2 meters under the surface and turned it in to police…divers on Tuesday carried out a thorough search of the area around where the bar was found, but didn’t find any more Gold or other valuables…

Gold 2.5-Year Weekly Chart

Despite today’s minor pullback, Gold is clearly on the rebound after landing at strong support at the bottom of this downsloping flag in place for more than 2 years…as you can see, the next target area is around $1,150…a bullish low “W” has formed in the SS, similar to what occurred late last year prior to an 18% jump in the Gold price, while what we’ll be watching for during the next few weeks is a potential bullish +DI/-DI crossover…

Breakdown In U.S. Dollar Index

Technical deterioration continues in the U.S. Dollar Index which has broken below an RSI(14) uptrend line that formed after the retreat in the greenback through mid-May, while a price uptrend line has also been breached…the 100-day moving average (SMA) – not shown on this chart – is also now in decline…it appears the Fib. 93-cent level will be tested once again…failure of that support could cause the Dollar Index to slide further to the 88 level…

Since the Venture performs best when the dollar is in retreat, the odds of a Venture rally have increased…

Today’s Markets

Asia

It’s hard to trust anything coming out of China these days…the People’s Bank of China (PBOC), which of course is not independent of the government, said today that there was no basis for more yuan depreciation in light of “strong economic fundamentals”, even though the yuan declined for a 3rd straight day…if the economic fundamentals were so strong in China right now, authorities wouldn’t be acting so desperately with one stimulus measure after another…the devaluation of the currency is the government’s direct response to a significant slowdown in Chinese exports…the #1 Chinese export now appears to be deflation…

Europe

European shares rallied moderately today after China’s central bank said there was no basis for further yuan depreciation after a devaluation this week that has seen the currency slide around 4%…

North America

The Dow is up 23 points as of 9:00 am Pacific…U.S. retail sales rebounded in July as households boosted purchases of automobiles and a range of other goods early in the 3rd quarter…retail sales increased 0.6% last month, slightly above expectations, while June’s figure was revised up to show retail sales unchanged instead of the previously reported 0.3% drop…despite this encouraging economic news, financial markets have shifted their rate hike expectations toward December following China’s devaluation of its currency this week…

In Toronto, the TSX is off 71 points while the Venture has added 1 point to 580…

Venture 4-Month Daily Chart

Several encouraging factors regarding this 4-month daily Venture chart:

1.  RSI(14) has come out of deep oversold conditions and is now climbing an uptrend line

2.  Sell pressure continues to decline

3.  The -DI indicator appears to have peaked

4.  The EMA(8) is flattening out at 582 – watch for a potential near-term breakout above the EMA(8)

Garibaldi Resources Corp. (GGI, TSX-V) Update

Investors too often make the mistake of being bullish when they should be bearish, and being bearish when they should be bullish…below is an updated 2.5-year weekly chart for Garibaldi Resources (GGI, TSX-V) showing the extreme oversold conditions that have persisted since June and how GGI has landed at exceptionally strong support…our view is that the bearish trend has peaked, and what we’ll be watching for are breakouts above the RSI(14) and price downtrend lines…

GGI is unchanged at 5 cents as of 9:00 am Pacific…

Kirkland Lake Gold Inc. (KGI, TSX) Update

A prudent approach, aided by a weak loonie, has allowed Kirkland Lake Gold (KGI, TSX) to remain profitable and generate free cash flow over the past 12 months…yesterday, the company reported a record quarter of Gold production (41,482 ounces) for May through July (full financial results will be released September 14)…the company achieved grade improvement of 7% to 0.45 ounces per ton (15.4 g/t) over the previous quarter which was also slightly higher than the guided grade of 0.43 ounces per ton (14.7 g/t)…

Kirkland Lake operates Canada’s highest-grade Gold mine and expects production to ramp up to 160,000 to 180,000 ounces per year…

Technically, strong support was demonstrated last month around $4.50 – a Fib. level which is also in close proximity to the rising 300-day SMA (not shown on this chart)…KGI is now above its SMA(50) for the first time since June, while the EMA(200) is reversing to the upside which is a very bullish sign…

KGI us off 14 cents at $5.61 as of 9:00 am Pacific…

Yamana Gold Inc. (YRI, TSX)

Yamana Gold (YRI, TSX) came within a penny of important support at $2.25 when it traded as low as $2.26 intra-day August 26…that represented a staggering 89% drop from the late 2012 all-time high of just over $20 per share…

Beginning in mid-2004, as you can see in this long-term chart, Yamana began a move that took it from a low of $2.08 to a high of $18 in early 2008…the Crash took Yamana down to just under $4 per share before the roller coaster ride took the stock back up again for a 5-five gain…

Has Yamana finally found a bottom?…quite possibly…estimated all-in sustaining costs for 2015 are targeted to be approximately $830 per ounce of Gold, and approximately $10.50 per ounce of Silver with the company expecting to deliver production of 1.3 million ounces of Gold, 9.6 million ounces of Silver and 120 million pounds of Copper…

In the first half of 2015, the company produced approximately 47% of expected full-year Gold production with the majority of its portfolio tracking at or above budget expectations…the company expects improved operating results for the remainder of 2015 and production growth into the next several years…

YRI is down 16 cents at $2.85 as of 9:00 am Pacific…

Note:  John and Jon both hold share positions in GGI.