Taking profits in Gold miners, rotating

Sold 1000 Yamana Gold (AUY) @ $12.70. 16% gain on this lot; still have 700 left. Bought 100 GoldCorp (GG) @ $54.80.

I don't really like the severe underperformance (relative and absolute) of miners vs. the metal. We've kissed my $1570 target for the metal from the IH&S pattern so I'm getting a bit cautious and getting smaller.

Definite rotation underway from $Silver to $Gold, at least in the momo trade.

Shine Shine on me Silver

I've heard all the talk that "Silver is in a bubble". I've also heard all of the J.P. Morgan silver short conspiracy theories. The reality is, Silver is in backwardation, and that backwardation is growing steeper every day. This is a classic supply/demand story in the short term, and ultra-bullish for price. Originally I had pegged $35 as my target for $SILVER this year -- I think we may have to up that to $40. Will $SILVER come back to life after that? Probably, but I wouldn't be shorting it here. Try to find a 100oz or 1000oz bar for delivery -- let me know how that works out for you.

To quickly address the J.P. Morgan Short issue -- If JPM is really short, they are probably short in the OTC market against some other big counterparty (producer, other bank). In fact, they may actually be LONG in COMEX as a hedge to their OTC short position.

Silver -- at least a ST top in

The Silver ETF has traded over 8x its normal volume while making a new lifetime high.

$SILVER traded to a new 30 year high (just the Hunt brothers got a worse price) over $29.

I believe at least the short term top is in on Silver; I would be shocked if at least it didn't correct 10% from here additionally.

$GOLD may get dragged down with it as well for a short time.