By Chris Oliver, MarketWatch
HONG KONG (MarketWatch)—Gold futures trended lower in late Asia trading hours on Monday, tracking the risk-off trade that saw equities and other industrial commodities lower in the wake of diminished expectations of further quantitative easing after last week’s stronger U.S. jobs report.
Gold for December GCZ2 -0.59% fell 0.5%, or $8.90, to $1,771.10 an ounce on the Comex division of the New York Mercantile Exchange in late trade in east Asia.
Gold futures closed out Friday on a weaker note, tumbling $15.70 an ounce, off a 10-month closing high in the previous session. The metal lost 0.4% for the week.
The U.S. jobless rate fell below 8% for the first time since December 2009, as the economy created 114,000 jobs in September, according to data released by the Labor Department Friday.
Gold had risen in the weeks since the Federal Reserve launched a third round of quantitative easing. The policy easing move was partly in response to persistent weakness in the job market, the minutes of its September policy board meeting, released Thursday, showed.
Monday’s declines also came as precious metals analysts warned of a topping pattern -- the end of the rising price pattern -- forming for both gold and silver, with recent advances coming close to overhead resistance.
A large short position by commercial traders, a group viewed as being among the savvier precious metals investors, as well as the inability of gold or silver to decisively break higher late last week were cited as factors in online commentary posted by Clive Maude.
“A bloodbath is believed to be imminent in the silver market, now that its cheerleaders have herded their flocks into the corral, ready to be fleeced again,” Maude said in an Oct. 8 posting on his self-entitled gold-tracking web site.
Silver for December delivery SIZ2 -1.90% was down 2%, or 69 cents, to $33.88 per ounce.
Commodities were also under pressure as the dollar rose on global growth worries. On Monday, the World Bank lowered its 2012 growth forecast for China to 7.7% and said the Europe crisis poses a major threat to Asia, cutting growth for that region to 7.2% in 2012 and 7.6% in 2013. Read more on World Bank forecasts for Asia
The ICE dollar index DXY +0.41% , which measures the greenback against a basket of six major rivals, rose to 79.548 on Monday, from 79.350 in late North American trading on Friday. Traders were also watching out for a meeting of euro-zone finance ministers later in the day amid worries over Greece’s next aid payment.
Chris Oliver is MarketWatch's Asia bureau chief, based in Hong Kong.
