Gold prices suffered their worst session in over two months on June 25 as a strengthening dollar and rising real yields triggered a coordinated selloff across precious metals. COMEX gold futures settled at $4,018.80/oz, down $111.10 from Tuesday's close of $4,129.90/oz.
The selloff was amplified by technical selling after gold broke below the $4,050 support level. The Dollar Index pushed above 108.5 for the first time since March, fueled by hawkish Federal Reserve commentary and stronger-than-expected US durable goods data released Wednesday morning. Higher yields reduce the appeal of gold, which pays no interest.
ETF flows turned sharply negative this week. According to data from the World Gold Council, physically-backed gold ETFs saw outflows of approximately 12.4 tonnes in the week ending June 23, the largest weekly withdrawal since January. The liquidation was concentrated in North American-listed funds.
On the Shanghai Futures Exchange (SHFE), gold futures followed COMEX lower, trading at 568.2 CNY/g, down 1.9%. The premium for SHFE over COMEX narrowed to $4.20/oz, suggesting weaker physical buying interest from China after several weeks of strong central bank purchases.
Gold forward curves remain in contango across all tenors, reflecting the carry cost of holding physical inventory. The 3-month forward premium stood at $9.80/oz, consistent with current interest rate and storage cost assumptions.
Despite the sharp decline, institutional positioning data from the CFTC shows that money managers' net long positions in COMEX gold futures and options remain elevated at 189,000 contracts. This suggests the selloff was driven more by macro hedging flows than a structural shift in sentiment. If the dollar rally stalls, gold could find support near the $3,950 level.
If you have near-term gold purchases on the books, consider staggering orders into this weakness. The $3,950-$4,000 zone has held as support four times since March. For hedgers, current premiums on 3-month forwards remain manageable. Review your hedge ratios if gold is a direct input — a sustained break below $3,900 would signal a deeper correction.