Gold and silver headed to their lowest levels since 2010 today. The U.S. dollar soared due to a new round of quantitative easing by the Bank of Japan. Also data from U.S. confirmed the economy’s good shape.
Gold breached important support levels at $1,200 and $1,180, where stop losses (automatic sale orders) were placed and was on track for a 5.2% drop this week. That’s the biggest weekly decline since June 2013.
“This sort of sharp move down, quiet move up has been a feature of the gold market for the whole year, where you have some really sizeable selling and some small, less effective buying, so we keep moving to the next ranges lower and the next level is $1,130,” CEO Ross Norman said, a broker at Sharps Pixley’s .
Spot silver fell 4% to its lowest since February 2010 at $15.76 and was poised for a 4th monthly drop in a row.
The latest hawkish comments from the FED and strong U.S. gross domestic product data on Thursday damped gold’s appeal as a hedge against risky asset classes.
ETFs: GLD, SLV
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