I see that silver is down 41 cents as I write this. That follows up a steep selloff on Friday. In fact most of last week, silver was trading lower in Asia even when gold was higher and the dollar was weak. I have noticed that Standard Bank (Japan) is a huge net short on TOCOM and they came out with some bearish commentary last week. So I am guessing they are taking full advantage of clueless metals traders and exploiting the sentiment that the metals are in correction mode, since they are trapped net short and underwater to the tens of millions of dollars. I would think that as long as the big commercial players can stampede silver traders into selling they will press the advantage, but sooner or later there will have to be some move to start covering that silver short exposure and the metal will recover.

The other explanation for gold and silver to be capped and driven lower is that some really bad news is probably on deck for early in the week. It is standard drill for the manipulation to really go after the metals just before the release of more data that would normally drive the metals higher. We got the same drill last week with the lousy employment data. Since Citigroup and JPM are rumoured to be taking huge writeoffs against subprime, it makes sense that the Cartel will pound the metals lower before that is officially announced.

Just another day in a phony market that has allowed the criminals to run interference without fear of the goddamn regulators doing their job.

cheers!

mike