Gold Down 5%

The price of gold dropped more than 5% today after Fed Chairman Ben Bernanke's testimony, which said that QE3 was not imminent.  Today's 5% drop is the 29th time since 1980 that gold has seen a one-day drop of more than 5%, and it was the first occurrence since last September.

In the table below we highlight each of these occurrences along with gold's performance on the following day and over the next week.  Following the prior 28 5%+ drops, gold has averaged a decline of 0.55% on the mext day with positive returns just 46% of the time.  Over the next week, gold has averaged a modest gain of 0.24%, but the frequency of positive returns is still only 46%.

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