On Wednesday (October 23), the gold price fell after hitting a record high, as the strengthening of the US dollar and the rise in the yield of US treasury bond bonds offset the support from the demand for safe haven brought by the US election on November 5 and the Middle East war.

As of 01:30 Beijing time, spot gold fell 1.19% to $2716.10 per ounce, hitting a historic high of $2758.33 earlier in the session.

(30 minute trend chart of spot gold)

Gold is seen as a tool for hedging against political and economic uncertainty. Driven by the Federal Reserve's interest rate cut last month and safe haven demand, gold prices have risen by over 32% this year, breaking multiple historical highs.

Bob Haberkorn, senior market strategist of RJO Futures, said: "There are some profit taking behaviors, and the yield of US treasury bond bonds is rising. Considering the trend of yield, gold price will be difficult to rise."

However, Haberkorn added that due to safe haven demand, gold prices may rise to the level of $2800 per ounce this weekend.

The dollar index rose 0.3% to close to a three-month high, making gold less attractive to holders of other currencies, while US bond yields climbed to a three-month high.

Ole Hansen, head of commodity strategy at Shengbao Bank, said, "Due to the uncertainty brought about by the US election and the increase of the US debt burden, the US government had to issue billions of dollars of bonds to the relatively scarce and tight market before the election."

Less than two weeks before the US presidential election, a Reuters/Ipsos poll shows that Vice President Kamala Harris leads former President Donald Trump by a narrow margin of 46% to 43%.

At the same time, analysts point out that this price drop may indicate that investors have partially taken profits at high levels. SP Angel pointed out in the report that the rise of gold price was related to the selling behavior of the US treasury bond bond market. Meanwhile, the progress of the BRICS summit has also attracted market attention, and the ongoing discussions on de dollarization may have a positive impact on gold prices. SP Angel also mentioned that fund managers increased their long positions in gold this week, while their short positions decreased. In addition, the holdings of gold exchange traded funds continue to rise, maintaining a level of approximately 84 million ounces.

Spot silver hit its highest price since the end of 2012 at $34.87 on Tuesday, before falling 2.7% to $33.90 per ounce.

Kinesis Money stated in a report, "The current gold/silver ratio is around 80, which means that as gold enters new upward space, silver will naturally benefit as well