Mcx gold tips:
Manila: Gold plunged 4 percent to its lowest in more than five years on Monday with platinum also sinking 5 percent to its weakest since 2009 as investors sold the precious metals on the viewpoint for the U.S. dollar.
It was a sudden, massive drop for gold and platinum prices as they breached critical support levels as the dollar strengthened on growing hopes that the U.S. Federal Reserve will hike interest rates this year.
"It looks like someone was taking advantage of the low liquidity environment at the moment. It`s a bit of speculative selling moving on," said Victor Thianpiriya, analyst at ANZ Bank in Singapore.
Nearly 900,000 lots were traded on a key contract on the Shanghai Gold Exchange, compared to less than 27,000 assortments on Friday, Reuters data showed. Prior to Monday, volume for July had averaged less than 30,000 lots.
"The market looks very technically weak and the biggest buyer of all, China, is now selling gold as averse to buying it on price dips. That`s a recipe for poorer prices," said Thianpiriya.
China said on Friday its gold reserves were up 57 percent at the end of June from the last time it adjusted its reserve figures more than six years before. Despite the tonnage increase, gold now accounts for 1.65% of China`s total forex reserves, against 1.8% in June 2009.
Spot gold was down 2.4 percent at $1,106.90 an ounce by 0302 GMT after falling as far as $1,088.05, its lowest since March 2010.
Gold has breached key support levels as the dollar gained after Federal Reserve Chair Janet Yellen told Congress last week that the Fed is on course to raise interest rates if the U.S. economy balloons as expected.
Platinum lost as much as 5 percent to $942.49 an ounce, its weakest since February 2009. Palladium dropped as much as 3.4% to its lowest since October 2012.
It was a sudden, massive drop for gold and platinum prices as they breached critical support levels as the dollar strengthened on growing hopes that the U.S. Federal Reserve will hike interest rates this year.
"It looks like someone was taking advantage of the low liquidity environment at the moment. It`s a bit of speculative selling moving on," said Victor Thianpiriya, analyst at ANZ Bank in Singapore.
Nearly 900,000 lots were traded on a key contract on the Shanghai Gold Exchange, compared to less than 27,000 assortments on Friday, Reuters data showed. Prior to Monday, volume for July had averaged less than 30,000 lots.
"The market looks very technically weak and the biggest buyer of all, China, is now selling gold as averse to buying it on price dips. That`s a recipe for poorer prices," said Thianpiriya.
China said on Friday its gold reserves were up 57 percent at the end of June from the last time it adjusted its reserve figures more than six years before. Despite the tonnage increase, gold now accounts for 1.65% of China`s total forex reserves, against 1.8% in June 2009.
Spot gold was down 2.4 percent at $1,106.90 an ounce by 0302 GMT after falling as far as $1,088.05, its lowest since March 2010.
Gold has breached key support levels as the dollar gained after Federal Reserve Chair Janet Yellen told Congress last week that the Fed is on course to raise interest rates if the U.S. economy balloons as expected.
Platinum lost as much as 5 percent to $942.49 an ounce, its weakest since February 2009. Palladium dropped as much as 3.4% to its lowest since October 2012.
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