IMVHO, there will absolutely no traction to the upside for gold until the COMEX op-ex which I believe is next week. Any strong moves higher will be capped, and then the gains stripped away in subsequent sessions. The Cartel has been very active all month to keep the sector in a tight grip. They usually wait until the days just before op-ex and a then follow up with a few sessions after, and then let it go.

I point out that the dollar has been in decline most of the last month, so the capping action is even more blatant. I think its related to the angst in Europe and the shaky DOW. The Cartel has been forced to dump a lot of paper gold in the markets to keep things from getting interesting, and therefore they are managing the price now much more carefully to ensure that those contracts above $1200 will expire worthless.

I think there could be some fireworks in August. And I would note that the BIS gold swaps may have assisted some trapped shorts to deliver, but the silver story is even more acute. I do not know of any CBs that have silver bullion to serve up. So as COMEX inventories continue to shrink, it may be a shortage of silver that triggers the next big bull move for the metals. I have been watching and waiting a long time for the gold:silver ratio to decline. I do not think there is any manipulation that can restrain silver from breaking above $20 this year. Maybe that will be the event that triggers more interest in the junior producers.

cheers!

mike