Gold fell after the open of US futures trade on Tuesday, with soft oil prices and long liquidation overwhelming a preference to stand aside before the US Federal Reserve starts two-day interest rate talks.
A floor broker said early light selling appeared to scope out where the stop-loss sell orders were located, providing a target for traders looking to run the market lower again.
At 9:37 am EDT (1337 GMT), December gold at the COMEX division of the New York Mercantile Exchange was $4.40 lower at $578.20 an ounce, extending a $13.50 slide on Monday after failing to extend a rally above $600 an ounce last week.
The early range was $584.90 to $577.30 an ounce, the lowest price in 12 days. December gold rallied to $606 on Friday, before a crude oil rally fizzled amid doubts that Opec could deliver on a sizeable production cut members agreed to late last week.
NYMEX December crude was off 24 cents early Tuesday at $58.57 a barrel, undermining the case for gold as an inflation hedge. Firmness in the dollar also discouraged foreign gold investors, while a record-breaking Dow Jones industrial stock average lured investors to the stock market from commodities.
Spot gold bullion was quoted at $574.00/5.50, down from New York's close at $580.40/1.90 on Monday. London bullion dealers fixed the morning spot reference price at $578.40 an ounce. December silver was down 31 cents at $11.37 an ounce, after drooping 29.5 cents the previous session. Tuesday's range was from $11.775 to $11.35.
Spot silver eased to $11.28/35 from $11.58/65. The fix was at $11.57. NYMEX January 2007 platinum was down $16.40 to $1,058 per ounce. Spot platinum was last priced at $1,052/1,057. December palladium had slipped $4.35 to $317 an ounce. Spot palladium last fetched $312/317 an ounce.