Gold slides below $1,360/oz as dlr recovers

Subject: Gold slides below $1,360/oz as dlr recovers Sat Jan 15, 2011 10:34 pm

.LONDON:
Gold fell more than 1 per cent on Friday as the dollar briefly turned
positive versus the euro, extending losses made after China earlier
raised lenders’ reserve requirements and as a lack of haven demand
weighed. The metal had pared losses as the dollar lost ground after US
data showed a below-consensus rise in retail sales last month, but soon
slipped lower. Solid bond sales by Portugal and Spain have cut haven
buying of gold, analysts said Gold slides below $1,360/oz as dlr recovers Gold-slides-below-1360-oz-as-dlr-recovers

Gold slides below $1,360/oz as dlr recovers Gold-slides-below-1360-oz-as-dlr-recovers

Spot
gold was bid at $1,359.10 an ounce at 1610 GMT, against $1,372.75 late
in New York on Thursday, having earlier hit a low of $1,356.50. US gold
futures for February delivery fell $27.50 an ounce to $1,359.50.
Gold
prices rallied above $1,390 an ounce on Thursday, its highest this
year, before turning lower to drop nearly 1 per cent on the day. It has
since retreated further.
“The rally we saw yesterday apparently drew
out a few nervous longs who had been waiting for an opportunity to scale
back positions,” said Ole Hansen, senior manager at Saxo Bank. “It
looks like attention (for now) has turned to other markets like stocks
and cyclicals.”
“The overall scenario has not changed but it looks
like we are settling in for a bit of range trading here — $1,350/1,400
gold and $28/30 on silver,” he added.
“Stops are probably building up below those two levels, so they will be critical in the days ahead.”
Gold
dropped after China’s central bank raised lenders’ required reserves
for the fourth time in just over two months on Friday, making good on
its vow that inflation fighting will be a top priority for the year.
Traders
in Asia reported strong physical gold buying, particularly from China,
on Friday, but large bullion-backed exchange-traded funds continued to
see outflows.
Holdings of the world’s largest gold ETF, New York’s
SPDR Gold Trust, fell by more than 6 tonnes on Thursday and are down
more than 15 tonnes so far this year.
Among other precious metals,
spot silver was bid at $28.44 an ounce against $28.67. Platinum was at
$1,810.49 an ounce against $1,799.99, while palladium was at $791
against $803.75. -Reuters

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