Gold Continues Below $800 As Oil Prices Fall, Dollar Firms

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While the majority of analysts believe gold will break its 1980 record of 850 usd per ounce in the medium term due to the weak dollar and a possible slowdown in the US, gold prices have been fluctuating dramatically since breaching the 800 usd mark at the beginning of November.

Gold continued to trade below the 800 usd mark in afternoon London trade as falling oil prices and a firmer dollar weighed on prices.

'A breach of the 90 usd and then the 89 usd level in crude oil for the first time in a month kept the pressure on gold,' said Kitco analyst Jon Nadler.

Gold tends to move in line with oil prices and in opposite direction to the dollar, serving as an inflation hedge and an alternative investment.

Additionally, with many investors looking to square their positions before the end of the month, and some players spooked out of the market by recent price volatility, many analysts believe gold is entering a consolidation period after its recent rally...

While the majority of analysts believe gold will break its 1980 record of 850 usd per ounce in the medium term due to the weak dollar and a possible slowdown in the US, gold prices have been fluctuating dramatically since breaching the 800 usd mark at the beginning of November.

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