Gold is supported below $1100 level on the start of new week

Dropping below the low of November 2014, the move represents the lowest gold price since 2010. US gold mining equities have also taken a beating. High debt levels accumulated during the boom are now weighing on stocks as the US Dollar gold price falls towards the cost of production.

Ongoing speculation of an imminent rate rise in the US didn't help gold's cause. On the topic of China's gold reserves, the 'lower than expected' number didn't really surprise seasoned observers. China can move enough gold to PBOC when they are ready and report that to the IMF for purposes of allowing the Yuan in the SDR. Meanwhile, they can still hide gold in SAFE and CIC until they need it in the future.

The slide towards and below $1100 will only encourage more short selling.