Gold got crushed again

Jeff Mitchell / Getty Images

The gold price copping a hiding yet again in Asia.

Just after midday, Sydney time, the price has fallen by a further $15.40, or 1.41%, to $1,078.70.

It’s now trading at the lowest level seen since February 2010.

The US dollar index, something that often has an inverse relationship to movements in the gold price, is currently up 0.16% at 97.269.

The decline in the gold price is adding to pressure on Australian-listed gold miners. Northern Star was down 6.85% to $2.04, Newcrest 6.42% to $11.08, Ocean Gold 7.19% to $2.58 and Evolution 8.33% to $0.99.

The decline today is a continuation of weakness seen earlier in the week. On Monday the precious metal posted its deepest one-day loss in nearly two years, pushing prices through key chart levels and setting it up for further weakness according to a report from Reuters.

Citibank analyst David Wilson believes the metal will likely remain under pressure in the lead up to the Federal Reserve’s September policy meeting.
“The markets are all focusing on a September rate hike, so assuming that is when it occurs, you have to think that gold is going to remain under downward pressure up until that point,” said Wilson.

Technical analysts, who study past price patterns to estimate the future direction of trading, say the next downside target for gold is $1,044, its 2010 low.

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