Gold Plunges Most for Week in Five Months

Gold prices today dropped another $6, bringing the ending total $1,177 an ounce, after falling as low as $1,176.10 on the Comex in New York. For the week, gold prices fell by 4.2 percent, the worst decline since early December.

There were a variety of reasons for the fall, with some of it being traders had large losses in equities, and had to cover the losses by selling gold.

A correction in gold prices was expected, and the metal had been surging for some time, and after reaching an all-time high of $1,249.70 on May 14, it was inevitable it would have to correct, and the correction has been steep because of other factors like the EU debt debacle and rising inflation in China.

But for the most part, this probably not much more than the speculators taking profits after the big run-up in gold prices, and once that settles, we'll see gold prices resume their upward climb, as nothing in the fundamentals has changed.

It's also a good time to take a larger position in gold with the prices down so much.