Hi Pic!

Based on my own observations, we have started every year, quarter, and month with a smackdown in the metals. This includes July, as it was a holiday in Canada on Friday but the US markets were still trading and got hammered hard. The selloff in the juniors today is a reaction to that since some investors appear to have decided enough is enough and are selling out of this sector. On a thin volume trading day it only takes a few small market sell orders to gap a stock down.

I am still trying to decide whether this is a good thing or a bad thing. Obviously for those that want to accumulate gold, silver, and the PM stocks its great to have a chance to load up so cheaply. Also, I have heard many people state that capitulation is required to clean out the sector and set up the conditions for the next upleg. My response to that is just WTF does it take to blow out the market? We are down by 50% in many juniors and I think the entire sector is off by 30% already. What other goddam sector does it take that kind of bloodletting to establish a floor? A dramatic takedown go on in the midst of a 10-yr bull market is probably a good thing but one must question what other games are going on behind the scenes to create such an utter washout. When the last retail schmuck has given up hope I guess the crooks and hedge funds will go long and we can enjoy another great fall rally.

cheers!

mike