Gold Bull Marches On

Just when you thought the record gold shorts were about to take gold back down to earth, out came the long awaited news of IMF selling 200 tons of gold to India for $6.7 billion. As well there is rumours the Chinese will be buying a second 200 ton lot.

It was a slow response to this news and one that had been felt may be a negative on the gold market. When the price did start moving it moved hard and fast , doubling from $7 to $14 within half a minute and seriously squeezed the shorts all the way up to $25 range where it closed solid.

Silver lagged the gold move by an hour or so but then closed up at $17.21 up a decent 70 cents or so. There is a much larger short position out on silver and if gold keeps this up then look out silver bugs, we could be over the critical $20 very fast and the junior silver stocks like my fave Artha Resources, V.AHC will come alive.

The most amazing part was the US dollar was up half a cent which as we know usually means lights out for gold. Should make for some interesting action the rest of the week to see who has the biggest pair to risk waiting out any higher moves or if the sellers will step in at any failure to break $1100.

Strap on the seat belts, should be a wild week.