By Myra P. Saefong and Barbara Kollmeyer, MarketWatch
SAN FRANCISCO (MarketWatch) — Gold futures fell Friday, poised for a second-straight session of losses, as some disappointment over U.S. economic data reverberated, driving gains for the U.S. dollar.
Gold for December delivery GCZ2 -1.46% fell $9.10, or 0.5%, to $1,735.60 an ounce on the Comex division of the New York Mercantile Exchange. Prices, which closed with a loss of $8.30 on Thursday, were trading 1.4% lower for the week.
“Gold rose in a mini parabolic curve in anticipation” of the Federal Reserve’s third round of quantitative easing announced last month, said Ned Schmidt, editor of the Value View Gold Report. “Gold then broke through that curve into a lateral pattern.”
“All of this looks like a classic buy on the rumor, sell on the news,” he said. “QE3 has clearly not been the magic elixir for the markets.”
And “gold, having broken down, through the lateral pattern is now short-term oversold,” said Schmidt, but that often happens when the “price is breaking down out of a channel.”
For now, the “path of least resistance is down. Downside on gold is $1,650. Silver remains a long-term sale,” he said.
December silver futures SIZ2 -2.61% shed 33 cents, or 1%, to $32.54 an ounce, poised to be the biggest decliner among the major metals for the week, down 3.4%.
A report released Friday said U.S. existing home sales declined 1.7% in September to a seasonally-adjusted annual rate of 4.75 million. Economists polled by MarketWatch had expected a rate of 4.8 million. See: Sales of existing home sales decline 1.7% in September.
The dollar held its gains after the housing data. Strength in the greenback in turn tends to hurt dollar-denominated commodities such as gold.
The dollar index DXY +0.34% , which measures the greenback against a basket of six currencies, rose to 79.566 from 79.207 in late North American trading on Thursday.
The dollar was also gaining as investors eyeballed the European Union summit for news and braced for some disappointment on banking supervision. The European Council said Friday it has set a deadline of Jan. 1 for agreeing a legislative framework for a single banking supervisor.
“Europe’s politicians seem to have kicked things into the long grass for a few more months as they fail to agree on steps towards banking supervision or closer political (i.e. fiscal) integration,” said Rebecca O’Keeffe, head of investment at Interactive Investor, in a note. “As interest rates continue to fall, so the need to act decisively diminishes.”
Over in South Africa, gold miners who faced dismissal for going on an illegal strike returned to work at Gold Fields Ltd. GFI +0.81% , according to news reports, but the strike at Anglo American Platinum Ltd. AGPPY 0.00% , which began last month, continued. See: What strikes in South Africa really mean to metals.
U.S. stocks fell after some disappointing earnings from Microsoft Corp. MSFT -2.80% released after the close of trading Thursday. See: U.S. stocks drop on earnings news.
Among other metals, platinum for January delivery PLF3 -1.56% fell $11.70, or 0.7%, to $1,632 an ounce, trading around 1.6% lower from a week ago. December palladium PAZ2 -3.56% fell $15.80, or 2.4%, to $631.40 an ounce, down about 1.1% from last Friday.
Copper for December delivery HGZ2 -2.87% lost 6 cents, or 1.6%, to $3.68 a pound. It’s down about 0.5% from a week ago.
Myra Saefong is a MarketWatch reporter based in San Francisco.
Barbara Kollmeyer is an editor for MarketWatch in Madrid.
