Gold slid to its lowest in four months on Thursday as a bounce in the dollar sparked by optimism over U.S. tax reform plans helped break the metal out of its recent narrow trading range.
Prices had been hemmed between $1,265 and $1,300 an ounce since mid-October as a series of record highs in stock markets detracted investment interest from bullion, and as traders awaited an expected increase to U.S. interest rates this month. Gold broke out of that range this week, extending losses after slipping below its 200-day moving average at $1,267.
"We've had a (breakdown) of support at $1,260, which is a key level," said ActivTrades chief analyst Carlo Alberto de Casa. "From a technical point of view, many traders had stop-losses just below $1,262, and today the market is going down for this reason."