The XAU Index(last 173.94) has been really cooking as of late. There has been on average of about two good percentage moves each month, both up and down, for a period of about nine months, roughly, between 165 to 200. The preceding major consolidation period took 20 months in time which only had one up and down move within a range for each month on average from, roughly, 120 to 150.

A suspected powerful force is working overtime attempting to frantically cap buyer enthusiasm on the Index at the 200 level each time the area is approached. About six times the 200 level was passed but prices failed to hold. On one attempt, prices fought gallantly for about three weeks but were brought down with "carpet bombing." The picture of so many violent swings looks like a boiling tea kettle getting ready to burst.

Somewhere along in time, hopefully, the next move past 200 will be enough to ignite some real fireworks. If this event happens, it is suspected that both gold and silver will be on the move as well.

It would be nice if this scenario develops as it will encourage the hibernating junior and resource sectors to come alive and resurface as a fiery dragon ready to slay the fleeing and crying naked shorts all the way to the other side of the planet.

Go ECU!!