Gold futures traded lower on Tuesday after finishing the previous session below the closely watched $1,800-an-ounce level for the first time in nearly three weeks.
Traders await the conclusion of a two-day meeting of Federal Reserve policy makers that began Tuesday. Officials are expected to discuss plans to eventually taper of the Fed’s bond-buying program, but economists said details are unlikely to emerge.
Meanwhile, investors are also tracking developments in China, where a regulatory crackdown on U.S.-listed technology firms has sent ripples through equity markets.
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“While gold bugs may draw strength from the shaky risk sentiment following crackdowns in China, the precious metal is likely to remain confined within a range” until the end of the two-day Fed meeting, said Lukman Otunuga, senior research analyst at FXTM, in a market update.
“A hawkish central bank could deliver a heavy blow to zero-yielding gold,” he said. “However, a meeting filled with doves may boost the precious metal’s allure, possibly sending prices higher.”
Gold for August delivery GC00, -0.26% GCQ21, -0.26% was down $2.90, or 0.2%, at $1,796.30 an ounce on Comex. The most-active contract settled Monday below $1,800 for the first time since July 6, FactSet data show. September silver SIU21, -2.66% also traded lower, down 64.8 cents, or 2.5%, to $24.67 an ounce.
On a technical basis, sustained weakness for gold below the psychological $1,800 level may drag prices lower towards $1,760,” said Otunuga. “If bulls can secure control back above $1,800, gold has the potential to retest $1,825, which is just below the 200-day simple moving average.”
After the Conference Board said Tuesday that index of U.S. consumer confidence on Tuesday rose to 129.1 this month from a revised 128.9 in June, gold prices briefly turned higher, the fell back toward sessions lows.
Among other metals traded on Comex, September copper HGU21, -0.29% fell 0.4% to $4.57 a pound, after tacking on over 4% Monday.
October platinum PLV21, -2.00% fell 2% to $1,049,10 an ounce and September palladium PAU21, -2.84% shed 2.8% to $2,602 an ounce.
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