Gold prices dropped to a four-year low last week, and
CNBC contributor Ron Insana thinks the precious metal is in for more pain.
"If I were a betting man, and sometimes I am, the long-term chart of gold suggests that the old high in gold of $800 an ounce could be its new low," he writes in a commentary for CNBC.
December gold futures settled at $1,162.90 an ounce on the Comex Wednesday, after hitting a four-year nadir of $1,130.40 last week.
"In the absence of a full-scale geopolitical crisis, economic collapse or other 'black swan' event, there is no good reason to hold gold."
The metal's bearish fundamentals include low inflation, a strong dollar and a buoyant stock market, Insana explains.
Consumer prices rose only 1.7 percent in the 12 months through September. Meanwhile, the dollar reached a seven-year high against the yen and a two-year peak against the euro last week.
And the S&P 500 index and Dow Jones Industrial Average climbed to record highs yet again Wednesday morning.
"The dollar, given growth and interest-rate differentials between the U.S. and the rest of the world, is likely to continue its rally, putting downward pressure on gold and silver, and on all commodity prices, for that matter," he notes.
"If you're still looking for a safe-haven investment, a better option would be large-cap stocks with lots of cash and good management like Disney, Apple or Microsoft," Insana writes.
Experts say that anticipation of interest rate hikes by the Federal Reserve will continue to weigh on gold.
"People are now coming to grips with the fact that we're done with quantitative easing, and the Fed is going to raise rates next year," Adam Klopfenstein, a senior market strategist at Archer Financial Services, tells
Bloomberg.
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