When watching the price action in gold one should always look for anomalous behavior.  As Zerohedge has been pointing out all week, gold and silver have been relentlessly hammered during the COMEX pre-market through the close of European trading and then, on balance, rising again for the rest of the day.  No matter how much things change they remain the same.  This behavior has been a hallmark of the gold bull market for most of its tenure.  Pound the metals during the NY hours, let it rise on short covering during low volume international trading.

Today was the first time in February where we didn’t see this little drama play out.  We didn’t see huge volume either.  That happened last night in Shanghai.  So, after flirting with the stops at $1555 last night,  gold finally reversed itself and had something of a good day, pushing back near $1585 before meandering around to close the Globex session at $1575.  The real test comes tonight and tomorrow.  Can the bulls push the metals’ prices back over $1600 in gold and $30 in silver and close there for the week?  Given everything that has happened that would be a very solid signal.

The March silver open interest, now less than 5 days from closing and contract holders able to stand for delivery, remains exceptionally high.  Enough to crash the COMEX?  Not if you believe the COMEX warehouse reports, but every day that this goes on the closer we’re getting to the moment where someone is willing to call the paper-hangers’ collective bluff.

I’m grabbin’ popcorn.