Gold Prices Plummet Nearly 4% Amid Decreased Market Risk Appetite

Spot gold prices plummeted nearly 4% intraday, sparking concerns about its future trajectory. Analysts are divided on whether it will continue to decline or rebound.

The sharp drop in spot gold was largely driven by a decrease in market risk appetite, which led to a withdrawal of safe-haven funds from the precious metal.

A slight increase in US Treasury real yields also weighed on non-interest-bearing precious metals like gold and silver.

Technically, gold prices broke below short-term moving averages, with the 4-hour MACD forming a death cross above the zero line. The RSI has retreated from overbought territory, putting downward pressure on gold prices in the short term.