Gold breached the “psychologically important” $1,300 support level this morning. Whether gold sells for $1,299 or $1,301 doesn’t really matter much to the average producer, but some observers say it triggered “pre-placed stop orders,” sending prices even lower.
So, what did I do?
I placed an order with my broker to buy a gold stock I’ve been watching, hoping for a shot at lower prices.
The stock was down over 4% yesterday. I may be able to bag some shares at a good 10% to 15% off recent highs.
We’ll see.
Unfortunately, there’s no bullion dealer here in Puerto Rico. Days like today were just the sort that would prompt me to hop in my car and head over to my local coin before moving here. Maybe I’ll do some shopping at Kitco.com.
The last time I can remember buying gold—well, silver, actually—because it was rising was in 1980. Luckily for me, I ran out of savings from my paper route when silver hit $25, so I didn’t buy at the very top. But it was almost 30 years before I would have been able to recover my investment.
What a painful lesson that was…
Now, I wait for days like today. This discipline served me particularly well in 2008. I expect it to serve all contrarian speculators well going forward.
As Warren Buffett said:
“Be fearful when others are greedy and greedy when others are fearful.”
