Investing.com -- Gold plunged to a fresh one-month low on Tuesday amid a stronger dollar, extending a Fed-inspired losing streak triggered last week when the U.S. central bank sent hawkish indications that it could raise interest rates before the end of the year.
On the Comex division of the New York Mercantile Exchange, gold for December delivery traded in a broad range between $1,114.20 and $1,137.90 before settling at $1,116.20, down 19.80 or 1.71% on the session. Last Thursday, gold futures plummeted more than 2.5%, one day after the Federal Open Market Committee explicitly stated in its October monetary policy statement that a decision to hike short-term rates will be on the table at its December meeting. The FOMC did not include the line in its policy statement from its meeting in September.
Gold futures have closed lower in five consecutive sessions, dropping to levels not seen since early-October. Since peaking above $1,185 an ounce in mid-October, the precious metal has closed in the red in 12 of 16 trading days. During the span, gold has lost approximately 3.75% in value.
Gold likely gained support at $1,105.80, the low from October 2 and was met with resistance at $1,189.00, the high from Oct. 14.
Investors await the release of Friday's U.S. national employment report for further clues on whether the Federal Reserve could normalize monetary policy at the next FOMC meeting on Dec. 15-16. Nonfarm payrolls were expected to rise by 190,000 in October, significantly higher than a relatively soft reading of a 142,000 gain a month earlier. Economists also expect the unemployment rate to inch down by 0.1% to 5.0% and average hourly wages to tick up by 0.2%. The Fed has indicated that it will closely watch the next two U.S. jobs reports as it weighs its decision.
A rate hike is viewed as bearish for gold, which is not attached to interest rates and struggles to compete with high-yield bearing assets.
Elsewhere, China president Xi Jinping declared on Tuesday that the country's annual economic growth rate should be no less than 6.5% over the next five years, the Xinhua News Agency reported. The Chinese premier reportedly is confident that the outlook could allow China to fulfill all of its economic goals by 2020. According to the plan, China is committed to attaching the yuan to the International Monetary Fund's reserve-currency and closing its income gap, Xinhua reported.
China is the world's largest producer of the gold and the second-largest consumer of the precious metal behind India.
The U.S. Dollar Index, which measures the strength of the greenback versus a basket of six other major currencies, surged more than 0.30% to an intraday high of 97.57. Last week, the index surged to a 10-week high at 97.89 following the FOMC's comments. The dollar rose sharply in spite of reports of subdued factory orders for September, which fell for the 11th time in 14 months.
Dollar-denominated commodities such as gold become more expensive for foreign purchasers when the dollar appreciates.
Silver for December delivery fell 0.183 or 1.19% to 15.225 an ounce.
Copper for December delivery gained 0.010 or 0.44% to 2.329 a pound.