UBS reduced its 2014 gold forecast by 9.4 percent, to $1,200 an ounce from $1,325 previously.

Spot gold hit a five-week low of $1,215.60 Tuesday. February Comex gold futures settled at $1,220.80 Tuesday, down $1.10 from Monday.

The "struggle for gold not only rests with the predominant selling interest among investors currently, but with limited positive catalysts looking forward, gold is unlikely to regain its former appeal," UBS analysts write in a commentary obtained by MarketWatch.

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The downward spiral could pull gold down to $1,050, they say, which would represent a "decent buying level." But the path there could be "very turbulent."

UBS also slashed its silver forecast for 2014 to $20.50 an ounce from $25 an ounce and its 2015 forecast to $21 an ounce from $24 an ounce.

Meanwhile, Societe Generale analysts are urging their clients to sell gold next year, according to MarketWatch. The analysts say that rising bond yields will hurt commodities, especially gold. They predict the precious metal will end next year at $1,050.

Some experts see room for gold to drop in the short term, also. "Despite a small short-covering rally [Tuesday], gold is susceptible to further pullbacks," Frank McGhee, head precious metals dealer at Chicago commodities brokerage Alliance Financial, tells Reuters.

"Right now a stronger crude market and lower dollar are the only things that keep gold higher."

Expectations that the Federal Reserve will taper its quantitative easing are weighing on the precious metal.

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