RTRS:PRECIOUS-Gold dips, market seeks clues on U.S. policy move
* Gold awaits direction, trapped in $20 range below $1,550
* Gold due for deep correction - technicals [ID:nL3E7H8041]
(Adds details, comments; updates prices)
By Rujun Shen
SINGAPORE, June 8 (Reuters) - Gold ticked down on Wednesday
as the dollar edged up from one-month lows against a basket of
currencies, while investors looked for hints on the U.S. central
bank's next policy move after its chairman acknowledged the
economy had slowed.
Gold breached $1,550 for the second straight session on
Tuesday, but failed to close above that key level as the lack of
clues on further stimulus plan in Federal Reserve Chairman Ben
Bernanke's remarks kept investors on edge.
"Gold lacks momentum for a rally but does not have much room
on the downside," said Li Ning, an analyst at Shanghai CIFCO
Futures. "We need some earth-shattering news to stimulate the
market."
If the Fed flagged further quantitative easing, it
would drive investors, wary of future inflation, to store their
value in bullion, traders say.
Spot gold ticked down 0.1 percent to $1,540.74 an
ounce by 0336 GMT, snapping a three-day winning streak.
U.S. gold GCcv1 also edged lower 0.1 percent to $1,542.
Gold is likely trapped in a range between $1,530 to $1,550
before any decisive move, traders and analysts said.
Technical analysis suggested that gold could be due for a
deep correction, according to a Reuters market analyst Wang Tao.
[ID:nL3E7H8041]
Bullion prices were being supported by the dollar
which rebounded from a one-month low hit on Bernanke's comments
and after a Chinese official warned on holding excessive
dollar-denominated assets.
A raft of sluggish data recently showed the U.S. economy was
losing steam, just as the Fed's $600 billion bond purchase
programme -- which has flooded markets with cheap cash and
boosted prices of gold and other commodities -- is due to
complete by the end of the month.
Spot silver lost as much as 1.2 percent to $36.66,
before rebounding slightly to $36.83.
"The discouraging economic outlook has affected the stock
market, as well as metals with industrial applications, such as
silver," said a Hong Kong-based dealer.
Asia stocks softened on Wednesday, after the comments from
Bernanke added to fears about the strength of the global
economy.
Silver, which leads the precious metals complex with a near
20-percent year-to-date rise, is expected to outperform other
precious metals over the long term, as investors may continue to
favour its leverage to gold, said Austria-based hedge fund
Superfund.[ID:nL3E7H70Y8]
Platinum group metals also edged lower. Spot platinum
dropped 0.4 percent to $1,821.39. Spot palladium fell 0.2
percent to $802.50, after rising to a three-month high of $807.5
on Tuesday.
Precious metals prices 0336 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1540.74 -2.11 -0.14 8.54
Spot Silver 36.83 -0.28 -0.75 19.35
Spot Platinum 1821.49 -7.06 -0.39 3.05
Spot Palladium 802.50 -1.88 -0.23 0.38
TOCOM Gold 3971.00 -29.00 -0.73 6.49 45635
TOCOM Platinum 4733.00 5.00 +0.11 0.79 7119
TOCOM Silver 94.80 -0.30 -0.32 17.04 726
TOCOM Palladium 2064.00 21.00 +1.03 -1.57 353
COMEX GOLD AUG1 1542.00 -2.00 -0.13 8.48 8537
COMEX SILVER JUL1 36.86 -0.19 -0.52 19.12 4354
Euro/Dollar 1.4663
Dollar/Yen 79.94
TOCOM prices in yen per gram. Spot prices in $ per ounce.
COMEX gold and silver contracts show the most active months
