Sinister is the best way to describe what is occurring in the precious metals markets. That description can’t just be assigned because of disappointing price drops. It is how, when, and why they drop, which is so sickening and perverse.

For the last 13 years the GATA camp has highlighted the activities of The Gold Cartel and their various tactics … such as PLAN A, B, and C, 2% Rule, etc. Another is to foretell imminent attacks on gold by selling in the gold/silver shares or silver right before an assault on gold. In the case of the shares it is usually a day earlier … for silver it can be minutes or hours. It is as if they are sending out their signals to other traders about what is to come for bullion.

Last night was a perfect example of how The Gold Cartel operates. In early Asian trading hours gold was down $2.50, but silver was down over 50 cents, especially glaring after the way it traded Friday on the Comex. Huh? Not too long after, like in a blink, gold suddenly fell over $25 in minutes … yet another one of its waterfall collapses … another Gold Cartel raid in action following their silver smoke signal...

It went from bad to worse. Gold fell to $1656 on the Comex before calming down. Silver actually fared relatively better following its initial bombing last night. It sank to $30.78 early but seemed to want to get back around $31, even with gold under pressure. The sequence often appears to be JP Morgan knocks silver, gold gets trounced, and then the Morgan traders take advantage of the gold selling to cover their silver shorts. Bing, bang boom … money in their pocket.

It is clear what The Gold Cartel was up to. Gold had formed a giant wedge pattern since late summer and the cabal’s contrived selling during a very light trading time in Asia (another drive-by shooting) blew the price through the floor of the lower wedge trend line…

Daily gold

http://futures.tradingcharts.com/chart/DG/

According to Café member Craig Rogers, gold dropped from $1711 to $1688 in a matter of minutes as 4,000 contracts were dumped on the market. That sort of selling is not done by anyone trying to maximize profits on their sales. There was an agenda there, pure and simple … another Gold Cartel tactic to demoralize the market and to hoodwink long speculators.

Once that floor of the well formed wedge broke it engendered all sorts of technical selling including that of the ubiquitous Dennis Gartman…