Gold falls to fresh 5-week low as weak technical picture weighs
Investing.com
Published Feb 12, 2013 03:34AM ET
Markets appeared to shrug off news of an apparent nuclear test by North Korea earlier in the day.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,642.75 a troy ounce during late Asian trade, down 0.4% on the day.
Prices fell by as much as 0.45% earlier in the session to hit a daily low of USD1,641.95 a troy ounce, the weakest level since January 4.
Gold prices were likely to find support at USD1,626.05 a troy ounce, the low from January 4 and near-term resistance at USD1,670.25, Monday’s high.
Gold’s losses came as a bout of technical selling continued after prices broke below a key support level on Monday.
Traders sold the metal after futures fell below their 200-day moving average, triggering fresh sell orders amid bearish chart signals.
Gold traders are now looking ahead to a meeting of Group-of-20 finance ministers in Moscow later in the week, which was likely to feature discussions on competitive currency devaluation.
Investors also remained cautious ahead of U.S. President Barack Obama's State of the Union speech later in the day.
Market players were also monitoring political developments in the euro zone, amid uncertainty ahead of upcoming elections in Italy and renewed political tensions in Spain where the government has become embroiled in a corruption scandal.
The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, was up 0.2% to trade at 80.55, the highest level since January 10.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
Elsewhere on the Comex, silver for March delivery fell 0.65% to trade at USD30.71 a troy ounce, while copper for March delivery dipped 0.25% to trade at USD3.713 a pound.
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Written By: Investing.com
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