Investing.com - Gold prices held on to modest gains in light trade on Tuesday, after robust U.S. durable goods data added to evidence the economy will be strong enough to allow the Federal Reserve to continue withdrawing support through 2014.
Trading volumes are expected to remain light due to the Christmas holiday and as many traders already closed books before the end of the year. Futures markets will close early on Tuesday and will remain shut Wednesday for Christmas.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,200.30 a troy ounce during U.S. morning trade, up 0.3%. Gold prices held in a range between USD1,195.70 a troy ounce and USD1,201.40 a troy ounce.
Futures were likely to find support at USD1,186.00 a troy ounce, the low from December 19 and resistance at USD1,226.00, the high from December 19. The February contract settled 0.56% lower on Monday to end at USD1,197.00 a troy ounce.
The Commerce Department said earlier that total durable goods orders increased by 3.5% in November, easily surpassing expectations for a 2% gain. Core durable goods orders, excluding volatile transportation items, climbed by a seasonally adjusted 1.2% in November, above forecasts for a 0.6% increase.
Orders for core capital goods, a key barometer of private-sector business investment, surged 4.5% last month, blowing past expectations for a 0.7% gain. Shipments of core capital goods, a category used to calculate quarterly economic growth, advanced 2.8% in November, significantly higher than expectations for a 1% gain.
Comex gold prices plunged to USD1,186,00 a troy ounce last Thursday, the lowest since June 28, as investors liquidated long positions after the Fed announced plans to begin tapering its monthly bond-buying program by USD10 billion in January.
Some market participants believe the Fed will likely reduce its bond purchases by USD10 billion in each of its next seven meetings before ending the program in December 2014, amid indications of an improving U.S. economy.
Gold is down approximately 29% this year, on track for its first yearly loss in 13 years and the worst since 1981, as solid U.S. economic data underlined expectations the Fed will begin curbing stimulus.
Elsewhere on the Comex, silver for March delivery inched up 0.05% to trade at USD19.42 a troy ounce, while copper futures for March delivery inched up 0.6% to trade at USD3/327 a pound.
Copper futures were higher as concerns over a cash crunch in China eased after the People’s Bank of China injected USD4.7 billion through open-market operations for the first time in three weeks on Tuesday, sending borrowing costs to around 5.5%, well off the previous day’s high of nearly 9%.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.
Trading volumes are expected to remain light due to the Christmas holiday and as many traders already closed books before the end of the year. Futures markets will close early on Tuesday and will remain shut Wednesday for Christmas.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD1,200.30 a troy ounce during U.S. morning trade, up 0.3%. Gold prices held in a range between USD1,195.70 a troy ounce and USD1,201.40 a troy ounce.
Futures were likely to find support at USD1,186.00 a troy ounce, the low from December 19 and resistance at USD1,226.00, the high from December 19. The February contract settled 0.56% lower on Monday to end at USD1,197.00 a troy ounce.
The Commerce Department said earlier that total durable goods orders increased by 3.5% in November, easily surpassing expectations for a 2% gain. Core durable goods orders, excluding volatile transportation items, climbed by a seasonally adjusted 1.2% in November, above forecasts for a 0.6% increase.
Orders for core capital goods, a key barometer of private-sector business investment, surged 4.5% last month, blowing past expectations for a 0.7% gain. Shipments of core capital goods, a category used to calculate quarterly economic growth, advanced 2.8% in November, significantly higher than expectations for a 1% gain.
Comex gold prices plunged to USD1,186,00 a troy ounce last Thursday, the lowest since June 28, as investors liquidated long positions after the Fed announced plans to begin tapering its monthly bond-buying program by USD10 billion in January.
Some market participants believe the Fed will likely reduce its bond purchases by USD10 billion in each of its next seven meetings before ending the program in December 2014, amid indications of an improving U.S. economy.
Gold is down approximately 29% this year, on track for its first yearly loss in 13 years and the worst since 1981, as solid U.S. economic data underlined expectations the Fed will begin curbing stimulus.
Elsewhere on the Comex, silver for March delivery inched up 0.05% to trade at USD19.42 a troy ounce, while copper futures for March delivery inched up 0.6% to trade at USD3/327 a pound.
Copper futures were higher as concerns over a cash crunch in China eased after the People’s Bank of China injected USD4.7 billion through open-market operations for the first time in three weeks on Tuesday, sending borrowing costs to around 5.5%, well off the previous day’s high of nearly 9%.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.