You see, general markets are selling off today too, and even oil has lost $6 per barrel since Thursday.
The U.S. dollar has maintained strength, probably thanks to speculation market in the U.S. Federal Reserve may end its quantitative easing sooner than previously expected volume. Thats may hurt commodities and other products which all priced in U.S.D's.
There are also be a considerable amount of selling of gold ETF s holdings, which has forced those ETF managers to sell their physical stock . That has temporarily added supply to the market, which helps push gold' to down price to this extream
And also seen an Upward trend in speculative short positions for gold futures on the COMEX exchange, lead by a decrease in speculative long positions in .
So those are the important pressures on gold. Now let's look at the other side of down trend
The other reason is that Chinese demand has been and remains very strong, along with considerable and growing demand from a group of other central banks, mostly from the developing world
Despite of all this issue,.carefully crafted statements from the Fed about potentially ending quantitative easing sooner than expected, the reality is that's highly unfavourable for gold. Their requirement of higher inflation and lower unemployment status are a long issue . Banking crises (like Cyprus), overhanging sovereign debt in UK,US,Japan etc intensifying currency wars will also remain a reality for some time to come in demand
Please Remember that bold headlines from major mainstream news and financial media, raising the specter of an end to the gold bull, also help in decline gold price..