Gold finally collapsed below the “taper tantrum†lows from 2013 and fell to $1167.17 – the lowest level since August 2010.
Can the precious metal fall even lower? Or has it reached a level in which the intrinsic demand (weddings in India, industrial use) will keep it bid?
What’s behind the fall? Basically, the Fed ended its QE program and had a bullish sentiment to offer markets, but the actual move down in gold came just as the Bank of Japan picked the baton.
It is also important to note that the markets are somewhat wilder than usual due to end-of-month flows.
Long term support appears at $1025, a place the pair stalled at on the way up. A big resistance level is $1400 which capped XAU/USD in the past year or so. Here is how it looks on the monthly chart:
For more on gold, silver (which also collapsed) and other previous metals, see Trading NRG.
