Gold threatens to drop to lowest since Feb 2010

By FXStreet FXStreet (Mumbai) – Gold fell to USD 1048/OZ levels; which was just short of the USD 1046.18 hit on Dec 3 low; and threatens to drop below the same, which will be a fresh low since Feb 2010.

USD index extends gains

The market continues to buy the US dollar, since the investors were caught off guard by the Fed’s Dot chart which pointed at four rate hikes in 2016. The USD index is now up 0.63% at 99.03 levels.

Consequently, the metal extended losses to trade around multi-year lows. The bid tone on the USD also appears to have improved after the US labor department reported a bigger-than-expected drop in the initial jobless claims.

The slide in the metal could continue and may come to a halt if the equity markets turn risk averse on prospects of four rate hikes next year.

Gold Technical Levels

At USD 1052/Oz levels, the immediate support is seen at 1046.18 (Dec 3 low), under which a major support is seen directly at 1032.30 (Mar 2008 high). On the other hand, a break above 1066-1067 (hourly 50-MA and hourly 100-MA) would expose the hourly 200-MA at 1070.60 levels.
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Source:: FX Street