We are witnessing a historical opportunity

Gold, or more preciously, precious metals, are killed. It is an engineered slaughter of the sector. Those who have the money in precious metals, especially those who came in late, are all panic and eager to exit. Margin calls are triggered and mutual funds are forced to sell due to wide-spread investors' redemption requests, which further worsen the situation. Given that the major support line for gold/silver has been broken down, there is a good chance that the volatility will continue in the short-term and gold and silver could go down further. However, to put this into perspective, this is not an abnormal phenomenon at all for gold/silver. During the last historical bull run for gold in 1970-1980, gold jumped up from $35 to $850 before it topped out. But this was never a straight line up. Gold actually dropped 50% from $200 to $100 between 1974-76. One has to understand that gold has been up for 12 straight years, which has never occurred to any other assets. By the law of nature, I guess it should be expected at some point gold should take a breath and come down to rest before running up again. After all, nothing fundamentally has changed to support gold to go up. If anything, things have only become worse, which should push gold to a much higher level. There is one thing I found interesting these days. While the gold price dropped like a rock, people around world are lining up to buy physical gold and most of the gold stores have run out of their stocks. This does not sound like the end of gold bull run.

Personally I'm certainly convinced that gold and other precious metals will come back and shoot up much higher. The current turmoil in this sector will turn out to be a historical opportunity to buy gold, silver and platinum. We just need to be patient to let the havoc settle down. I will be especially interested in RGLD and SLW, the two best royal gold and silver companies that have been decimated as well this time. The profit potential will be huge when the time comes. No rush and be patient!