Just a quick note, as gold reached levels mentioned in the latest Premium Update. At this point we believe there is about 60% probability that a decline will begin today or within the next few days. In fact, it seems that we might see the precious metals sector top today.

While the above might be enough information to buy small amount of put options or to short gold with a small amount of one's capital, this is not a "go short" alert. Of course you are free to take any position at any given time, but we would still like to see additional confirmation before suggesting betting on lower gold, silver and mining stocks' values.

Generally, we don't want to get into details here, but there are several signs that we see right now that suggest that the top is in:

- Gold hit the resistance level,
- Gold stocks are lagging gold,
- The volume during upswing was not big,
- The GDXJ:SPY ratio was rallying very strongly recently - more on this ratio in the coming update,

However, there are some developments that we were expecting to see and we didn't see them so far. These include:

- Extremely low volume along with higher prices in gold, and gold stocks (silver is more often misleading here),
- Resistance level being hit on the silver market (we're close though),
- Huge volume in the GDX:SPY ratio,
- Strong intra-day rally in juniors and senior gold stocks that are usually lagging gold.

If the decline begins soon, it will most likely be quite sharp. On the other hand, we don't want to risk opening a short position in case it does not materialize at all. The point here is that waiting for a confirmation is justified from the risk/reward point of view. If we're correct about the decline - we might miss only a small fraction (because of its size) of it by entering one day too late - the benefit of reducing the risk here is much bigger. The downside targets mentioned in the previous updates are still up-to-date today

We will keep you updated and let you know if we believe that we have a shorting opportunity, or if we believe that the current "summer-decline" theory is no longer valid.

Thank you.

Sincerely,
Przemyslaw Radomski