31
December
NY Gold Down Due To Squaring, Dollar Gains (GC in WSJ)
31 December 2009 Wall Street Journal
"Gold remains under pressure due to traders' unwillingness to enter the market in a meaningful way prior to year end," said Mark O'Byrne, director of the bullion dealer GoldCore. "End-of-year book squaring and the recent strength of the dollar [have] also led to gold's fall back below the $1,100-an-ounce mark."
The February gold contract has been as soft as $1,089, its lowest level this week.
James Moore, an analyst with TheBullionDesk.com, said gold and other precious metals are likely to react to movements in the dollar, but with any rallies for the time being likely to run into further pockets of long liquidation, or selling in which traders exit positions in which they previously bought.
Still, at least some investors who had been waiting for a sell-off have been buying on the decline so far in December, O'Byrne added.
For the New Year, O'Byrne said continued central-bank diversification into gold should provide support for the metal. Gold should also continue to attract market participants seeking diversification as long as monetary and fiscal policy remains accommodative in many nations.
