Gold and silver prices were sharply lower Thursday morning in a sign that traders are positioning for Federal Reserve tapering at the policy meeting next week. A gold miner ETF also traded to the downside as technical analysts eyed a key support level.
SPDR Gold Shares (NYSEArca: GLD) slipped 2.4% in premarket trade while iShares Silver Trust (NYSEArca: SLV) was off 2.9%. Market Vectors Gold Miners (NYSEArca: GDX) fell more than 3%.
Gold declined to a four-week low after weekly jobless claims fell to the lowest levels since April 2006. Jobless claims dropped below 300,000 but the data was skewed as two states made changes to their computer systems that resulted in some claims not being processed in time, according to MarketWatch.
GLD, the largest gold ETF, is experiencing inflows for the first time since early 2013 as investors closely monitor developments in Syria. [Gold ETF Seeing First Inflow Since February]
“As geopolitical risks fade, the focus is shifting back to QE and the Fed meeting next week, and we expect the market to remain volatile till then,” said Wang Xiaoli, chief investment strategist at CITICS Futures Co., in a Bloomberg News report