Gold hit a 10-1/2-month low of $1,122.35 an ounce on Thursday as U.S. Treasury yields and the U.S. dollar surged to a 14-year high, boosted by the prospect of more interest rate increases by the Federal Reserve next year. U.S. Treasury yields soared, lifting the opportunity cost of holding non-yielding gold. The latest move in short-term U.S. Treasury yields suggests that the price of gold has further to fall. Market morale continued to cool down. Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Shares, are down about 10 percent from mid-November. Gold is likely to cross below the key mark of $1,100. But a rebound expected in the long run on rising inflation expectations. On technical front, the upturn movement is about to end with current prices of $1,130 at the level of downward path since 2013. In between, gold can find support at $1,160 only.
Silver was down 5.2 percent at $15.95 an ounce, after falling to hit its lowest since June 1 at $15.82. The white metal is expected to extend losses to around $15.5 after breaching a four-week consolidation. On chart, the opening of Bollinger path widened after shrinking for a week, adding to a dead cross formed by the MACD index to suggest a bearish tone.
 

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