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Gold down for 10th straight day; longest losing streak since ‘96
July 23, 2015, 9:08 am
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Gold fell more than 1 percent to a five-year low on Wednesday as a bounce in the dollar fueled downside momentum, with investors continuing to pull away from the metal after its dramatic slide earlier this week.

A looming increase in U.S. interest rates, the first in nearly a decade, has diminished gold's appeal to investors, encouraging more sellers in the market after Monday's 3 percent rout, the biggest one-day drop since September 2013.

Holdings in the world's biggest gold-backed exchange-traded fund, SPDR Gold Shares, fell for a fourth day on Tuesday by another 4.8 tons, the least since 2008. Its reserves have nearly halved from their 2012 peak.

Spot gold was down 0.8 percent at $1,092.40 an ounce, after touching a five-year low at $1,086.90. U.S. gold futures for August delivery settled down $12 an ounce at $1,091.50.

Gold is down more than 6 percent over the last 10 sessions and Wednesday is the first time futures settled below $1,100 since March 25, 2010. This is gold's longest losing streak since the 13-session streak in Sept. 1996.

Gold's decline on Wednesday picked up momentum after the dollar moved into positive territory against a basket of currencies.

"We have a lot of pockets of weakness currently in the gold market, and that is what is feeding the bearish sentiment we see," Julius Baer analyst Carsten Menke said.

"The money managers are net short and that is relatively rare."

On Monday, a large selloff came on the back of huge volumes traded on the Shanghai Gold Exchange after investors dumped more than $500 million of bullion in New York in four seconds during early Asian trading hours.

That sparked a slide through key chart levels, triggering stop-loss orders that added to momentum. From a technical perspective, gold remains under pressure.

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