Gold's Largest Daily Decline in History
Global gold prices (loco gold) plummeted sharply on Tuesday (October 21st), recording their largest daily decline in 12 years, after hitting an all-time high of around US$4,381 per ounce the previous day.
According to market data, spot gold fell around 6% to around US$4,082 per ounce, while US gold futures fell 5.8% to US$4,145. A surge in profit-taking and a strengthening US dollar were the two main factors behind this pressure.
This situation reminded the market of several previous major events—including the correction in April 2013, when gold prices fell 9% in one day, and the crash of the early 1980s, when the precious metal lost more than 40% of its value in just a few months. In each cycle, the sharp decline always followed a major rally driven by investor euphoria and excessive speculation.
Meanwhile, analysts from Standard Chartered stated that "a too rapid gold rally without proper consolidation could trigger short-term technical pressure." However, they believe the long-term trend remains positive as long as prices remain above the psychological support area of US$4,000 per ounce.
With global trends still shrouded in interest rate uncertainty and geopolitical turmoil, the gold market is expected to remain volatile in the short term — but the long-term outlook remains bright as long as the US dollar does not strengthen aggressively again.
Source: Newsmaker.id
