Just as gold and silver were breaking out yesterday, the CME announced another hike in margin levels, which punched a hole in the balloon.

Actually with gold it looked a lot like the typical take-down by you-know-who. My guess is they used the CME announcement as the perfect impetus to do a quick raid. Again, in recent months the bear raids have been relatively infrequent and it seems they have to pick their shots carefully. So while some people might have been forced to liquidate some positions, and others were taking profit as silver went past $38, the big boys were using the CME news to maximum effectby running stops.

Despite all that, silver dropped only to $37 and has quickly moved back to the $37.50 area. It just won’t sink that much, and keeps bobbing back like a beach ball. The likely target is $39 once it gets through $38, and that could happen any time. The upside target for gold is $1456 if it can make it through $1441.

So today, if buying pressure keeps moving prices up, then the CFTC-related selling might have been a minor blip. We made it past the 10am low without much damage. Let’s see if we see a similar rise to yesterday’s without the hard sell-off in the afternoon. Then we’ll be in good shape for a strong week next week as March draws to a close.