As the Federal Reserve moves closer to boosting interest rates for the first time in nine years, the U.S. dollar is gaining strength, punishing commodities in the process. Gold and gold exchange traded funds are not exceptions to this rule.

For example, the SPDR Gold Shares (NYSEArca: GLD), iShares Gold Trust (NYSEArca: IAU) and ETFS Physical Swiss Gold Shares (NYSEArca: SGOL) have each posted losses in excess of 8% in just the past month and GLD is one of the worst offenders among ETFs in terms of fourth-quarter assets lost.

The U.S. dollar has been strengthening on greater speculation that the Federal Reserve will begin tightening its monetary policy in December after the surprisingly strong October jobs report. Most raw materials are priced in dollars and historically a strong USD has pressured commodities.

Although precious metals ETFs have recently displayed some strength, gold is still in a lengthy bear market, giving some traders pause about how much more near-term upside the yellow metal has in store. [Doubters in Gold Rally]

“Looking at a long-term chart of the GLD, Rich Ross noted that just before its massive decline, the ETF put in a double-top formation. Technicians often view these patterns as confirmation of reversal in trend,” according to CNBC.

Gold assets look more attractive in a low interest rate environment as the precious metal is more competitive against assets that pay low interest, like bonds. Additionally, if the Fed holds off on a rate hike, it would suggests the economy is not as strong, which would also help gold attract safe-haven demand.

Showing Page 1 of 2