*Intraday Alert for Cartel Smack-down*
This morning, the entire precious metals complex was racing to the upside. It’s now just past 1pm Eastern Standard Time. Gold and silver continue to hold their own, but the entire rally in the mining shares has evaporated. This speaks to only a few possible dynamics.
After watching cartel patterns for over a decade now, I can say without any doubt that the mining shares are often used as a signal for a raid on paper bullion trading over on the COMEX or in London within the following 24 hour period.
Are the signalling an imminent raid in gold and silver?
Conventional thinkers would suggest this is profit taking after big moves. There’s also the argument that some hedge funds are laying on spread trades, going long bullion and short mining shares. For the better part of the last two years, that was a common strategy among hedge funds.
Some of these dynamics are likely going on. But there’s another dimension. After watching cartel patterns for over a decade now, I can say without any doubt that the mining shares are often used as a signal for a raid on paper bullion trading over on the COMEX or in London within the following 24 hour period. There was no particular reason for the mining shares to suddenly fall apart today. The decline had nothing to do with the weakness in the general stock market. It’s fishy. I suspect it could very well be a combination of all the factors I note above. The speculators that rushed into the sector are certainly on edge, looking to book some profits. It wouldn’t take much cartel action to lead them along (shorting equities and naked shorting is effective because the markets are more thinly traded that global bullion markets). We may very well be seeing cartel footprints in the mining shares first, as is often the case.
In the grand scheme of things, this is not a big deal. In fact, it’s actually astounding that we’ve made it to options expiration in silver today without a smash earlier in the week. But as I get ready to push the “publish” button on this story at 1pm EST, I’ve got to say I wouldn’t be surprised to see the cartel whack bullion prices after the close of the standard COMEX session today — or sometime within the next 24 hours. If that fails to happen, the shares should regain some of their lost ground by the equities market close, and bounce back strongly tomorrow.