I am sitting patient in front of my screen this morning trying to get a read on how things will break. My expectation is for a nasty sell-down in the metals on Wednesday, and for a surprise rally across the main markets that lasts most of the week. But really it all comes down to whatever levers the interventionists are going to pull. There is no market anymore, we are all just along for the ride and can react to snip profits from the macro moves that are engineered behind the scenes.

"Investing" has come down to reading the motives of the biggest players and guessing when they will make their move so that you are positioned along for the ride.

The PM sector offers some relief from that scam because I do not think the TPTB are in charge of the metals. They can influence the short term, play games with the margin levels to run the specs, issue endless media commentary on the bearish side... but they cannot drive the metal lower if it wants to go higher. And higher it will go.

So now I am simply trying to estimate when the counterattacks will come and take profits, to redeploy that money back into the stocks again on the dips. So far today the sector leaders are not showing any signs of weakness at all. Before the CME ups the margin requirements they leak this to the big trading houses and we get a warning as the most liquid stocks selloff sharply. No evidence of that yet.

There does appear to be more short covering in the metals, and pain for the shorts is good news for the bulls. That is the theme of the day. I am sitting on my hands and watching carefully with my fingers crossed. I would love nothing more than to see Bob Moriarty look like a complete idiot and have silver blast through $50 this week, especially after that loudmouth clown made such a point of attacking anyone that was silver bullish in May. But I do not expect that to happen so quickly and I think we will retest $40 again at least once before the momo move above $50 can be sustained.

cheers!

mike