Gold held above the key $1,900 ceiling on Monday, despite a drop in prices due to technical selling following a fierce 3 percent rally in the previous session as the raging Israel-Hamas war sent investors scuttling to the safe-haven bullion.
Spot gold dipped 1.1 percent to $1,910.70 per ounce and US gold futures dropped 0.9 percent to $1,924.20.
Gold, viewed as a safe investment during uncertain times, eased from its highest since Sept. 20 hit on Friday, when it surged 3.4 percent in its biggest one-day rise in seven months.
“We saw an extreme move to the upside on Friday and such moves usually beckon some mean reversion,” City Index Senior Analyst Matt Simpson said.
“Given the surge in prices, gold will likely remain in focus for traders seeking to buy dips, which makes $1,920 and $1,900 areas of interest. But if tensions in the Middle East continue to escalate, shorting gold may not end too well for bears over the near term.”
Earlier this month, speculators turned net short on COMEX gold for the first time since November 2022. They increased their net short positions in the week ended Oct. 10.
