• Wednesday, December 06, 2023
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Gold heads for third weekly drop


  Gold fell one percent on Friday, showing that the metal is on track for third weekly drop, as the dollar rose and equity markets slid. Outflows from exchange-traded fund underlined the shaky outlook for bullion, according to Reuters report.

Traders said stop losses – automatic sale orders placed at pre-set levels to limit losses – went through at $1,560, causing a push lower in mid-morning trade, while selling accelerated as the metal fell through key chart support at $1,548.

The metal looked on track to re-test the 11-month low of $1,539.10 hit on April 4, traders said.

Gold has slipped around 7 percent so far this year and is matching a downtrend in other commodities and equity markets ahead of the U.S. retail sales, which will be monitored by the market to test the health of the world’s biggest economy.

Meanwhile, the dollar strengthened against the euro and a basket of main currencies. “For the rest of the day people are going to have a look at what’s happening with U.S. retail sales, which are closely tied with what is happening in the U.S. employment sector,” Standard Bank analyst Walter de Wet said.

“If retail sales are largely in line with expectation, the $1,550 area will hold but if it’s substantially better then expect a test of the low $1,540s.”

Wary investors continued to cut exposure to gold, with total holdings at the world’s major bullion gold-backed exchange-traded-funds (ETFs) falling to their lowest since early 2012.