INV: Gold futures little changed near 6-month low; FOMC minutes eyed
Investing.com - Gold futures were little changed near last week’s six-month low during U.S. morning hours on Tuesday, as investors stuck to the sidelines amid a weak technical picture.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery traded at USD1,611.50 a troy ounce during U.S. morning trade, up 0.1% on the day.
Prices held in a tight trading range between USD1,614.80 a troy ounce, the daily high and a session low of USD1,608.20 a troy ounce. Gold futures fell to USD1,598.25 a troy ounce last Friday, the weakest level since August 15.
Gold prices were likely to find support at USD1,590.25 a troy ounce, the low from August 15 and near-term resistance at USD1,635.95, February 15’s high.
A weak technical picture continued to weigh on the precious metal as investors were hesitant to enter the market and open fresh long positions amid bearish chart signals.
Gold prices fell below the key USD1,600-level for the first time since August last Friday, as a bout of technical selling set in after futures broke through key support levels, triggering a flurry of sell orders.
From a technical standpoint, gold could see further losses, with market analysts warning of a possible move towards the USD1,550-level.
A stronger U.S. dollar also weighed. The dollar index, which tracks the performance of the greenback against a basket of six other major currencies, hovered near a six-week high of 80.77.
Gold prices often move inversely to the U.S. dollar, as gold becomes more expensive for buyers using other currencies.
Gold traders now looked ahead to the release of the minutes of the Federal Reserve’s January meeting on Wednesday for hints regarding the central bank’s attitude towards monetary policy.
Any policy pause signal from the Fed minutes may send the U.S. dollar higher, pressuring dollar-denominated commodities.
U.S. housing data due this week will also be in focus as investors seek more cues on the country's economic health.
Any improvement in the U.S. economy could scale back expectations for further easing from the Fed.
Prices were modestly higher during the Asian session as physical dealers and jewelers across the continent took advantage of cheap valuations.
Elsewhere on the Comex, silver for March delivery added 0.3% to trade at USD29.93 a troy ounce, while copper for March delivery dropped 1.75% to trade at a three-week low of USD3.671 a pound.
