India, Jan. 30 -- Gold prices tumbled on Thursday, dropping over 4% as traders locked in gains after a sharp rally that sent the precious metal to record highs earlier in the week. Despite the sudden sell-off, bullion remains set for its best monthly run in more than four decades, backed by strong geopolitical tensions and sustained investor demand globally.

Spot gold fell 4.6% to $5,149.99 per ounce in late morning New York trading, after touching an intraday low of $5,126.00. The retreat follows a historic rally that lifted prices to a peak of $5,626.80, underlining the market's unusually high level of volatility.

Analysts point to immediate profit-taking as the primary catalyst for Thursday's sharp decline. "We are seeing a dramatic ...