NEW YORK: Gold languished near its lowest level since April 2010 on Thursday as investors dumped the safe-haven metal amid strength in the dollar and on fears that $1,000 an ounce is the next target.
Silver, under pressure from the dollar and sliding gold, was trading close to its lowest since February 2010 after losing 4 percent in the previous session.
The sell-off in gold began last Friday, when the metal broke through $1,180 – the lowest level hit during last year’s 28 percent plunge. Since then, dollar strength and breaks below other technical levels have built the case against gold.
Technical analysts have said a test of the $1,000 level could be on the cards following a break of support at $1,150 an ounce, a key retracement level.
Spot gold ticked up 0.3 percent to $1,143.80 an ounce by 0419 GMT. It tumbled over 2 percent to a 4-1/2 year low of $1,137.40 on Wednesday, following sharp losses after falling through support at $1,160 and $1,150.
Prices on the Shanghai Gold Exchange were trading at a discount or on par with the global benchmark on Thursday. They have been at a discount for most of this week, hinting at sluggish demand.
India, the second biggest buyer, hasn’t seen any fresh buying either at lower price levels.
The strength in the dollar also took down other precious metals. Silver firmed but was trading close to 4-1/2 year lows of $15.13 an ounce reached on Wednesday. Platinum fell below $1,200 before recovering slightly.
While physical demand for gold has been lacklustre, buying interest for silver coins has been strong. The US Mint said on Wednesday it has temporarily sold out of its American Eagle silver coins, while retailers in Asia and the United States were struggling to get supplies of the Canadian Maple Leaf silver coins.
