Wow! Gold and silver took a beating today, to put it lightly. Gold spot ended Comex trading at $619.60, off 2.07% from yesterday. It went down another $7.90 in the Access market. If you think that's bad, look at silver: down $2.13 or a whopping 14.65% in Comex trading, and another 49 cents to end at $11.92 in the Access market. For the day, HUI was down 25.90 to 359.40. Several of my stocks were down double digits.
Well, why do I sound almost giddy? A correction was due, to be fair. This sell-off was most likely precipitated by the new margin requirements. To be fair, the Nymex has been steadily raising margin requirements as can be seen from its new archive, although the pace is picking up. Whatever the reason, I consider this sell-off enormously healthy for the golden bull. I actually picked up some more SSRI (Silver Standard Resources, 300 sh @ $20.89) before noon. If there is anything I'm more bullish in than gold, it's silver. I may be a little early, but the adage "buy when there is blood in the street" apply exceptionally well to PM shares. Given the magnitude of the drop, plenty of those mo-mo players with 8-10% stop losses would have been taken out.
I can almost see those new "investors" trying to make a few quick bucks in PMs throwing up their hands, exaspertaing: "I don't care if gold is in a long-term bull market, get me out of there!" It takes iron stomach to be a PM investor, as anyone who has gone through similar drops will tell you. Never, never doubt this, it's the nature of any bull to throw off as many people as possible on its way to stratospheric heights.