Big up day in Gold and Silver. My longs fired above the breakout point (60 day high).

As Finley “Chick” Goslin likes to say, precious metals have a nasty habit of going down fast. (In other words, definitely don’t second guess the exit rule for the position).

I suspect the fear surrounding these metal contracts hails from a couple of historical points. Gold, famously, went above $800 in January, 1980. It got there in a hurry – from about $600 to over $800 in a few weeks – and it left there about as fast.By the end of that month, it wasn’t holding $700.A few months later, it was down to $400.

In 1979-80, Silver had an even more dramatic decline back.Fueled by the Hunt brothers, who accumulated vastly in the effort to corner the market, the price demise was hastened by changes of rules on the COMEX (the main exchange for Silver at the time) and the Federal Reserve. The high of $54 was followed by a steep decline. Silver lost more than 80% of its value. Great fun.A little more on the Hunt Brothers here.