Gold Futures Decline for Second Session, Reaching Three-Week Low

Gold futures experienced a second consecutive session of decline on Tuesday, reaching the lowest intraday price in nearly three weeks.

Back-to-Back Session Losses

Gold futures faced back-to-back losses on Tuesday, resulting in the lowest intraday price seen in almost three weeks.

In Tuesday's dealings, the gold for December delivery (GCZ23, -0.92% GC00, -0.92%) dropped by $19.10, or 1%, settling at $1,969.50 per ounce on Comex. According to FactSet data, it reached as low as $1,962.80 during the session, marking the lowest level for a most-active contract since Oct. 19.

October Record Closes

Despite the recent drop in gold prices, it is significant to acknowledge that October ended with new all-time record monthly closes for gold in various currencies such as dollars, euros, yuan, yen, and U.K. pounds. Adrian Ash, the director of research at BullionVault, highlighted how these levels were achieved through a surge of bullish speculation in Comex futures and options. However, this price surge caused difficulties for the physical market to absorb these higher levels, leading to profit-taking instead of a "gold rush."

Profit-Taking and Rebalancing

Ash explained that private investors utilized the latest monthly record highs to take profits and rebalance their overall positions. In October, BullionVault users sold 67.2% more gold than they bought on average each day, resulting in a net selling total of 470 kilograms. This represents the heaviest one-month liquidation since June 2019.

Gold Investor Index

The Gold Investor Index provided by BullionVault, which measures actual trading behavior among the world's largest single pool of private investors in physical precious metals, decreased by 1.4 points to 51.8 in October. This is the lowest level since January's 3.5-year low of 50.6, as reported by Ash.