IV:Gold prices set for worst annual loss since 1981
Investing.com - Gold prices were lower on the final trading day of the year on Tuesday, with the precious metal heading for its biggest annual loss since 1981.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,198.10 a troy ounce during European morning trade, down 0.5%. Gold prices traded in a range between USD1,194.10 a troy ounce and USD1,201.20 a troy ounce.
Futures were likely to find support at USD1,186.00 a troy ounce, the low from December 19 and resistance at USD1,218.30, the high from December 27. The February contract settled down 0.84% on Monday to end at USD1,203.80 a troy ounce.
Gold is down approximately 29% this year, on track for its first yearly loss in 13 years and the worst since 1981, as solid U.S. economic data underlined expectations the Federal Reserve will begin curbing stimulus.
Meanwhile, silver for March delivery dropped by as much as 1.2% earlier in the session to hit USD19.54 a troy ounce, before coming off the lows to trade at USD19.43, down 0.9%. Comex silver prices lost nearly 36% this year.
Market players looked ahead to U.S. data on consumer confidence and manufacturing activity in the Chicago region later in the day, to gauge if the U.S. economy will be strong enough to allow the Fed to continue withdrawing support through 2014. The U.S. central bank will reduce its bond-buying stimulus program by USD10 billion a month starting in January.
Some market participants believe the Fed will likely taper its bond purchases by USD10 billion in each of its next seven meetings before ending the program in December 2014, amid indications of an improving U.S. economy.
Trading volumes are expected to remain light as many investors already closed books before the end of the year.
Elsewhere on the Comex, copper futures for March delivery dipped 0.15% to trade at USD3.378 a pound.
Copper prices have been well-supported in recent weeks amid indications the U.S. economic recovery is deepening. The U.S. is second behind China in global copper demand.
Prices of the industrial metal are on track to post a gain of nearly 4.5% in December, but are still approximately 8% lower in the year to date.
