Gold plummets over $100 after hitting all-time high

Gold hits record high then plunges over $100 in wild reversal.

Berto Tordecilla

Berto Tordecilla

This news article is older than 30 days.

Gold prices saw extreme volatility today, rallying to an all-time high of $1,135 in Asian trading before staging a dramatic reversal, falling over $100 to settle at $2,020 towards the end of the London session.

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The initial surge is rumoured to have been fueled by traders betting on U.S. interest rate cuts in 2024 amid easing inflation and geopolitical tensions over the weekend that saw an attack on an American warship in the Red Sea.

However, prices then collapsed in a classic “pump and dump” pattern as bulls scrambled to cover positions. The plunge leaves gold nursing ugly losses after an outside reversal from record highs.

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While parts of the U.S. economy remain strong, persistent disinflationary pressure may cement trader convictions that the Fed will pivot to rate cuts next year. This could provide longer-term tailwinds for gold.

For now, bullion looks vulnerable to further downside with key support at $2,000. The jobs report and upcoming inflation data will be critical events this week that could dictate near-term direction.

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