per Bob Chapman 01/26/11 International Forecaster:
GOLD, SILVER, PLATINUM AND PALADIUM
Last week the largest US bullion banks, known as commercials, covered or offset 16,173 contracts of their existing short position. The short fell from 149.434 to 133,261. These positions are being held by 4 major banks and we need not tell you who they are. This is the lowest net short position in almost a year. This short covering is the precursor to a $150.00 or more rally that should take gold to $1,500 to $1,650. The elitists are throwing in the towel. Normally the shorts would have increased positions as gold climbed higher. They covered on the way down in anticipation of another rally upwards in gold. Every indication we have says gold will reverse here and climb right back up again. What is interesting is that the commercials, while covering shorts and obviously taking losses, also sold their long positions to offset their losses with gains. The pros do not think new gold lows can be accomplished and that a major buy side push upward is developing. Another phony correction is over.
On Monday spot gold rose $3.50 to $1,344.50, as February fell $9.40. Spot silver fell $0.07 to $27.38, as March fell $0.37. We’ve had a couple of weeks of manipulation, but it will pass. Gold open interest rose 2,266 contracts to 580,750, but silver OI fell 2,245 to 133,596. The XAU rose .22 to 2000.34 and the HUI fell 4.02 to 500.75. Gold and silver expiration occur on Wednesday so that should end the correction.
