The day continued to be a wild one, with gold coming right back, yet again, to $1790 and the DOW rallied more than 250 off its lows to rise above 11,000 yet again too. The Gold Cartel does not want gold to get above $1800 and the PPT does not want the DOW to fall apart after Bernanke taking center stage for the investment world. The problem for each is Europe. Their problems won’t go away and the situation is worsening.

It continues to strike me how strong the euro is and how weak the dollar is under the present circumstances in Europe. This tells us just how bad the US dollar really is, even compared to the Euro. Can the collapse of the dollar be far off?

The Fed and Bernanke were put in a box. They know the Fed has to do more economic stimulation, but they don’t want to be seen as soft on inflation. Is there anyone on Planet GATA who doesn’t expect them to do more to stimulate the economy, as it falls apart further? Perhaps this is the reason the dollar is acting so lousy with Europe in such trouble. The US is in worse trouble.

Planet GATA’s James McShirley has the real deal about gold today. You won’t get this input elsewhere…

Hanging out in the cartel's 2% hood

Bill,
The overhead resistance today has nothing to do with $1,800. That number coincidentally happens to be +2% for the day. It's always about the daily cartel limit. Busting out from $1,800 would be one of my cherished red flags. So far it appears they have a 3-foot thick iron plate set up there. It would be far too embarrassing for the Jackson a-Holes to be rudely interrupted from their duck a l'orange with a jolt of gold ripping back through $1,900. That figure may greet them for breakfast next week, however.

August continues to set records for most 2% days. They are spending serious ammo keeping daily limit bands together. At this point Sep./Oct./ Nov. continues to look very eventful. Any CME attempt to further de-leverage gold from here will be a sign of extreme weakness. Gold isn't remotely over-leveraged compared to the overall commodity complex. Like silver, they will be tipping their hand that the real stuff is evaporating.
James Mc

Talk about orchestration. Earlier in the week it was Warren Buffet and the Obama administration doing a Bank of America deal in an attempt to salvage that mess and to do what they could to bolster financial stinkers that were doing a submarine act. Then, the PPT was ready to rescue a sinking DOW after the Bernanke presentation, while The Gold Cartel was capping the gold rally.

As mentioned here for weeks, the effectiveness of The Gold Cartel continues to wane. The reason is simple: they are running out of enough available central bank gold to meet burgeoning demand. It is not only new central bank buying they have to contend with, but growing big money investor interest.

Yesterday on CNBC one of the Muppets noted how the gold investing landscape is changing dramatically. Sophisticated money is coming into the physical gold market in droves from many who never dreamed of investing in bullion before. In addition, The Muppet said that those investing types who had 5% of their portfolios in gold/silver investments have now upped the ante to 10% to 15%. This is a dramatic change and has to be giving The Gold Cartel fits.

The gold open interest fell 5325 contracts to 514,635 and the silver open interest dropped 1611 contracts to 118,443. Both represent short covering by the bums. Silver continues to be a rigged farce. Its open interest remained low for months. Then it shot up sharply right before The Gold Cartel bombed both precious metals. Now, it is going back down.

Gold/Silver Commitment of Traders Report

This report was calculated the first day gold broke down from $1900+ in gold, but before the $100 down day on Wednesday.

Silver

*The large specs increased longs by 6,059 contracts and increased shorts by 976.

*The commercials reduced longs by 274 contracts and increased shorts by 6,144.

*The small specs increased longs by 1,377 contracts and increased shorts by 42.

CLEARLY, ahead of the Thursday option expiration, JP Morgan and friends were going mega short silver to protect their written call positions.

Gold

*The large specs decreased their long positions by 5,313 contracts and increased shorts by 7,092.

*The commercials increased longs by 14,588 contracts and reduced shorts by 3,823.

*The small specs decreased longs by 557 contracts and increased shorts by a steep 5,499.

This gold report is STUNNING, and not what I expected at all. What the heck? What it does explain is why gold rebounded off of $1703 quickly and gone bonkers late today. Newby specs were caught on the short side and appear to be covering today in what seems like panic market conditions!Gold just went $1815 bid!

What a hoot! The small specs, and even some large specs, must have been listening to GATA critics Jon "The Nitwit" Nadler, and the bewildered Jeff Christian, who believed that the gold bull market was over.

By the way Christian's call at gold in the 1100 area was that it would average 940 for the next decade. He also said on cnbc that gold had topped at 1720, it then went immediately toclose to 1900. I think he called the top at 600....800....1000... also.