Gold is likely to drop further on Friday after the yellow metal plunged below $1,650 an ounce in the global market. Prices dropped as hedge funds indulged in year-end selling, while talks to solve the US fiscal crisis seemed stalled.

With the dollar ruling weak against the euro, there could be more pressure on the yellow metal. The rupee could gain but its movement either way is unlikely to dictate gold’s direction since its fall is much beyond this factor.

In early trade in Singapore on Friday, gold was quoted at $1,647.06 an ounce, while gold for delivery in February ruled at $1,648.20.

Gold for jewellery (99.5 purity) ended at Rs 30,595 for 10 gm on Thursday.

Bears will continue to dominate the oils and oilseeds counter with soyabean diving on the Chicago Board of Trade (CBOT) overnight. The Chinese factor played out in the market as some buyers, anguished over buying the beans at a higher price, cancelled another huge order running into some 3.4 lakh tonnes. That’s the second cancellation in a week’s time and the effect could rub on to palm oil too.

On CBOT, soyabean January contracts slipped to $14.08 3/4 a bushel. Crude palm oil March contracts on Bursa Malaysia Derivatives Exchange on Thursday ended down at 2,321 ringgits ($760) a tonne.

Corn (industrial maize) and wheat are likely to slip after the coarse grain breached the $7-level. Selling has set in the complex and it drags wheat in its strike. On CBOT corn for delivery in March was down at $6.96 1/2 a bushel.

Wheat for delivery the same month fell to $7.90 1/2 a bushel, a five-month low.

Crude oil is likely to rule firm as NYMEX crude stayed firm above $90 a barrel and Brent above $110. Brent crude closed in overnight’s trade at $110.20 on hopes of an end to the US fiscal crisis talks, while NYMEX crude ended at $90.13 a barrel.

This could see natural rubber firm as synthetic rubber, its alternative derived from crude oil, will gain.

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