It is that the market are anticipating a rate rise sooner rather than later reacting to the Fed's Fischer's speech as being more hawkish rather than dovish. This coupled with a strengthening of the green back caused a flight from gold. These are the fundamental reasons for what just happened but these reasons are exacerbated by the technicals. Gold has been trading in a tight range technically and the fundamentals have emboldened technical selling. If Daytr is right it should hit a key level of support at 1180 and then bounce back and carry on moving sideways until the market loses it's sensitivity to the potential destruction of rate rises. Any asset embroiled in debt will suffer. However, I am hopeful that paper gold traders have more sense than using credit or leverage to buy gold, which would ultimately crown gold as king amongst bonds, property and equities.
