COMEX gold futures opened moderately higher Tuesday in continued consolidation from recent sharp declines, but when US consumer confidence data came out well above forecasts the dollar firmed against the euro and gold prices turned down, traders said. Once the $390 an ounce support level was broken, stop-loss sell orders were triggered and accelerated the decline.
First notice day for the benchmark August gold contract is Friday, and players with long copper positions are expected to be rolling them forward all week.
Aside from switching business, traders said gold was still tracking the dollar. And, whereas gold prices were steady consolidating in range before the confidence data, sellers unloaded gold holdings as the dollar gained on the surprisingly strong reading.August gold was down $3 at $387.30 an ounce on the New York Mercantile Exchanges COMEX division after bottoming at $386.30 after the data came out. The high at $393.80 was similar to Monday's peak.
Many gold traders had been staying out of the market since Friday's sell-off. The August contract fell Friday to its lowest level since June 17 when the dollar rallied. After a week of selling, Friday's breakdown took gold below key support at $390 per ounce, unwinding the uptrend that had been building since early June.
COMEX estimated 1000 am EDT turnover at 23,000 lots.
Spot gold declined to $386.90/7.40 an ounce, down from $390.25/1.00 late Monday. Tuesday's afternoon fix in London was $389.85.
COMEX September silver was down 2.5 cents at $6.22 an ounce, in a range from $6.16 to $6.30. Spot silver changed hands at $6.19/22, off the $6.20/23 at Monday's close. Tuesday's London fix was $6.24.
NYMEX October platinum lost $4.40 to $807.00 an ounce, trading between $804 and $811.60. Spot platinum was lower at $807/812.
September palladium held steady at $220 an ounce, in a $218.50 to $2230.50 range. Spot palladium was quoted even at $217/222 an ounce.