I have to say that this is one of the few times I can recall where gold and silver have made explosive moves UP on thin trading days. Usually its the other way around. I define market manipulation as a direct attempt to distort the trading by employing high volume tactics in a thin market, in the absense of other related driving forces. The action today then sure looks like manipulation and it is the first time I have observed it on the long side.

What gives?

Is this the pre-emptive gambit to profit as gold rises in the new trading year? Is this a head-fake to get specs interested in gold again before a massive bear raid sweeps in and takes them all to the cleaners? Or is this a real trend change that demonstrates big money is losing faith in the stability of major markets and has begun to flee to gold?

Oil futures have also suddenly moved into higher territory this afternoon. Smart traders will not make a big move, either long or short, during times of thin volume when the price they pay is skewed by their own activity. Manipulation on the other hand relies on precisely that effect because the objective is to send a signal and not to secure the optimum trading profit. I think we have manipulation at work here but it will take a few sessions to know, as volume returns to the market and we will see what the real direction is.

cheers!

mike