Gold fell on Wednesday, as the combination of a firm dollar and weak oil prices left the metal on track for its third consecutive annual loss.
Bullion has lost 10% of its value this year, largely on concerns that higher US interest rates would hurt demand for the non-yielding asset.
Spot gold dipped 0.8% to US$1,060.10 ($1,495.01) an ounce by 2:38 p.m. EST (1938) GMT, while US gold futures settled down US$8.20 an ounce at US$1,059.80. Trading volumes were muted in the holiday-shortened week.
The rest of the precious metals complex also dropped, with platinum down 2% at US$869.51 an ounce after hitting a two-week low of US$850.50 an ounce, having fallen through a technical support level around US$860.
"Physical demand in gold continues to be relatively aggressive in the Far East compared with October and November, and on that basis gold should be much higher, but there seems to be this pressure from the dollar, which continues to put a lid on the price," MKS SA head of trading Afshin Nabavi said. "It looks like support is at US$1,045 and US$1,050, and resistance stands at US$1,085/US$1,095."
With little market-moving data due this week, bullion traders will rely on cues from the currency and oil markets, analysts said.
The dollar was up 0.05% against a basket of currencies and was heading for a 10% yearly increase, making gold more expensive for foreign currency holders.
Following the US Federal Reserve's move to raise interest rates for the first time in nearly a decade this month and indications that the central bank would resort to gradual increases in 2016, the outlook for gold does not look bullish.
Gold typically follows oil as the metal is often seen as a hedge against oil-led inflation.
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Bullion has lost 10% of its value this year, largely on concerns that higher US interest rates would hurt demand for the non-yielding asset.
Spot gold dipped 0.8% to US$1,060.10 ($1,495.01) an ounce by 2:38 p.m. EST (1938) GMT, while US gold futures settled down US$8.20 an ounce at US$1,059.80. Trading volumes were muted in the holiday-shortened week.
The rest of the precious metals complex also dropped, with platinum down 2% at US$869.51 an ounce after hitting a two-week low of US$850.50 an ounce, having fallen through a technical support level around US$860.
"Physical demand in gold continues to be relatively aggressive in the Far East compared with October and November, and on that basis gold should be much higher, but there seems to be this pressure from the dollar, which continues to put a lid on the price," MKS SA head of trading Afshin Nabavi said. "It looks like support is at US$1,045 and US$1,050, and resistance stands at US$1,085/US$1,095."
With little market-moving data due this week, bullion traders will rely on cues from the currency and oil markets, analysts said.
The dollar was up 0.05% against a basket of currencies and was heading for a 10% yearly increase, making gold more expensive for foreign currency holders.
Following the US Federal Reserve's move to raise interest rates for the first time in nearly a decade this month and indications that the central bank would resort to gradual increases in 2016, the outlook for gold does not look bullish.
Gold typically follows oil as the metal is often seen as a hedge against oil-led inflation.
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