It’s Monday, Japanese markets are closed and the gold price, courtesy of stop-loss selling and thin market conditions, has endured a wild ride today.
At 11.25am AEST the spot price tumbled 3.8%, or $43, to $1087 an ounce in just a matter of seconds.
“We have seen gold undergo what can really only be described as its mini ‘flash crash’ says Chis Weston, IG’s chief market strategist.
“Talk from one local bank has been that five tonnes was dumped onto the Shanghai exchange, which is a huge order regardless of the time of day.”
Having hit the lowest level seen since March 2010, the spot price has staged an impressive turnaround in Asian trade, rising back above the $1,100 level to $1,115.50 an ounce.
The moves in gold are being replicated across the precious metals space with platinum and palladium, down 5% and 3% respectively earlier in the session, halving their losses in afternoon trade.
Despite the late bounce the ASX All Ordinaries gold index finished the session down 10%, its largest one-day percentage decline since December 1, 2014.
Unsurprisingly, Australian-listed gold miners had a session to forget. Newcrest dropped more than 10% to $11.87, Evolution 14.5% to $0.97, Ocean Gold 8.2% to $2.80 and Northern Star 9.6% to $2.07.
The Australian dollar, having dipped to .7329 earlier in the session, has now turned positive for the day. At present the Aussie currently buys .7375.
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