I do not think the HUI is telling us anything bearish. More to the point, the entire PM sector is sending a very clear message right now. Exhibit A is the performance of silver recemty. We know that silver is rarely allowed to go higher during a COMEX op-ex window, yet it managed to do so in August. I do not recall seeing that kind of trading behaviour since I started buying silver, so this is something new and highly significant in my opinion.

Secondly, we know that the Cartel attacks gold and silver at the exact times when the background news is extremely PM friendly. Today with the ongoing bad news in the market, and the highly dollar-bearish FOMC minutes released, it would have been the usual procedure for the Cartel to attack. And that is exactly what they did this morning, driving both gold and silver sharply lower. But both recovered strongly, and silver was once again a star performer.

The HUI has been running hard lately and this volatile index is noted for sharp pullbacks. I suspect the Cartel is also active to short the HUI index component stocks are part of their campaign to keep gold off the radar. However I think the action today is just normal profit taking on a day when the DOW looked extremely weak. And note that the DOW makes yet another miracle recovery to stay above 10,000 today. Those who discount that a PPT is active and a big part of our market are completely clueless...

To recap, I would say that there are malignant interests that would dearly love to cap the HUI, and drive gold and silver lower. But I do not think that is indicated by the HUI performance today. There are some extremely important divergences in the sector performance lately that I think it is more important to pay attention to.

cheers!

mike