Gold Falls for Second Day as U.S. Data Lift Sentiment
Source: MarketWatch, Moming Zhou (3/17/09)
"Given the failure to clear above $940 last week the metal could look to test toward $890, as further stale long liquidation emerges."
U.S. housing starts surged 22% in February, the Commerce Department estimated Tuesday. It was the first increase in eight months. U.S. Treasurys, also seen as a safe haven, fell as well after the housing data.
Gold for April delivery was last down $5.10, or 0.5%, at $916.90 an ounce on the Comex division of the New York Mercantile Exchange.
"Rising equity markets are still seen as diverting some portions of the investment funds previously earmarked for gold," said Jon Nadler, senior analyst at Kitco Bullion Dealers.
Gold is now about $90 lower than the high above $1,000 hit on Feb. 20, and some observers see it vulnerable to further selling from a technical standpoint.
"Given the failure to clear above $940 last week the metal could look to test toward $890, as further stale long liquidation emerges," wrote James Moore, a precious metals analyst at TheBullionDesk.com.
Losses in gold prices came despite a surge in exchange-trade fund buying.
Holdings in the SPDR Gold Shares (GLD), the biggest gold ETF, hit a new high of 1,069.05 tons on Monday, up 12.23 tons from the prior day, according to the latest data from the fund.
In other metals trading, silver for May delivery fell 1.1% to $12.745 an ounce, while April platinum lost 0.3% $1,046.50 an ounce. The June contract for palladium lost 0.3% to $199.70 an ounce. Meanwhile, May copper sank 0.7% to $1.735 a pound.