Gold Drops Below $400 on Selling by Foreign Traders

The price of gold fell below the benchmark $400 an ounce level today on heavy selling by foreign traders.

Gold dropped to its lowest in New York since September, with the cash price trading below the psychological $400 on selling by foreign traders, apparently preoccupied with bearish market indications and a strong dollar.

On the New York Commodity Exchange (COMEX), spot gold slipped to $399.70 an ounce from Thursday night’s close of $403. The February delivery lost $4.70 at $398.50.

In London, the afternoon gold fixing was $399.75.

“The $400 price was a psychologically round number that brought in more selling after it was penetrated,” said John Rosko of Stanley B. Bell Inc., COMEX traders.

European traders have been pressing the sell side of gold for the last two weeks, sensing that the market was on a downward course, possibly heading to $360.