Gold's free fall is far from over, expert warns

Earlier this month, the price of gold skyrocketed to $1,900 an ounce. Today, the gold meltdown continued, as the price plummeted another 2 percent to $1,600 an ounce.

So much for all those commercials for investing in gold. And the slide is not over, Marc Faber, author of the Gloom Boom & Doom Report.

"We overshot on the upside when we went over $1,900," the fund manager, who has 25 percent of his portfolio in gold, told CNBC.

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"We're now close to bottoming at $1,500, and if that doesn't hold it could bottom to between $1,100-$1,200."

Faber, who said that the recent sell-off had come about following nervousness about industrial metals, added that a 40 percent correction wouldn't surprise him.

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U.S. gold suffered its biggest daily drop in more than five years on Friday.

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Recent falls in the price of gold came after a sustained rally which saw some predict that prices would hit $2,000 or even higher.

While gold is considered a safe-haven investment, investors have been turning to the U.S. dollar and Treasury securities.