By Barani Krishnan
Investing.com - For gold longs, $1,300 still seems tricky.
Bullion and futures of gold neared that key bullish mark on Wednesday as investors again sought the precious metal as insurance against fears of a potential collapse in U.S.-China trade talks and the impact of that on global growth. But profit-taking robbed gold of its upward movement and forced it to a lower settlement after a two-day rally.
Gold futures for June delivery, traded on the Comex division of the New York Mercantile Exchange, settled at $1,281.40, down $4.20, or 0.3%, after hitting a three-week high at $1,292.75.
Spot gold, reflective of trades in bullion, was down $4.09, or 0.3%, at $1,280.34 per ounce by 2:45 PM ET (18:15 GMT).
Gold's rival, the dollar, also fell. The dollar index, which measures the greenback against a basket of six currencies, was a touch lower at 97.39.
Gold is in a unique position of benefitting from both good and bad news on China, unlike the dollar, which has only risen as a hedge against troubles in the trade talks.
In the past, hopes for a U.S.-China deal boosted bullion on expectations that Chinese jewelry consumption would rise. In recent days, concerns that the same negotiations may be scuttled helped boost gold as a safe haven,
In Wednesday's session, gold initially rose as Wall Street's key stock indexes had trouble finding direction amid worries that an absence of a trade deal between the world's top two economies will be a drag on global growth. China's top trade negotiator, Vice Premier Liu He, was due to visit Washington on Thursday and Friday and will likely try to prevent Washington from raising tariffs to 25% from 10% on $200 billion of Chinese imports.
Some are still hopeful of $1,300 gold, though.
With Comex gold cracking the $1,291 resistance on Wednesday, its next test will be $1,299, Reuters technical analyst Wang Tao said.
Elsewhere in metals, palladium fell around 1% for a second day in a row, continuing with its choppy trend amid concerns that the auto-catalyst metal may have rallied too much, too soon in recent months.
Spot palladium was down $11.35 at $1,316.40 an ounce.
Trades in other Comex metals as of 2:45 PM ET (18:45 GMT):
Palladium futures down $16.50, or 1.3%, at $1,306.90 per ounce.
Platinum futures down $9.40, or 1.1%, at $864 per ounce.
Silver futures down 8 cents, or 0.5%, at $14.85 per ounce.
Copper futures down 1 cent, or 0.5%, at $2.77 per pound.