* SPDR Gold Trust holdings biggest one-day fall
* Gold to rebound to $1,342 - technicals
* Coming up: U.S. new home sales Dec; 1500 GMT
(Adds graphic; updates prices)
By Rujun Shen
SINGAPORE, Jan 26 (Reuters) - Spot gold prices held steady
on Wednesday, off a three-month low hit in the previous session,
supported by strong physical demand in Asia, as investors await
the U.S. Federal Reserve's rate decision and more economic data
for direction.
Holdings in the SPDR Gold Trust suffered its largest
one-day loss, down 31.262 tonnes to an eight-month low of
1,229.581 tonnes, as safe-haven demand from investors diminishes
at wake of improved economic data.
For a graphic on SPDR holdings and value in comparison with
the Dow Jones industrial average, click:
http://link.reuters.com/wet67r
U.S. consumer confidence rose in January to its highest
level in eight months, underscoring the brightening economic
outlook, although declining housing prices still cast a cloud on
the recovery.
"People like to liquidate their gold investment to move to
markets other than metals," said a Hong Kong-based dealer,
adding that even though robust physical demand remained
supportive, the price trend looked bearish.
"Prices will likely test $1,320 again, and upside pressure
is still a bit heavy."
The supply tightness in the physical market is expected to
ease as the Lunar New Year holiday arrives, traders said.
But gold prices are expected to average $1,450 an ounce in
2011, building on stellar gains from last year, boosted by low
interest rates, dollar weakness and lingering worry over growth
in major economies, a Reuters poll showed.
Spot gold was edged up 0.3 percent at $1,336.75 an
ounce by 0723 GMT, off the three-month low at $1,322.70 hit on
Tuesday.
U.S. gold futures also gained 0.3 percent at
$1,336.4.
Spot gold will rebound slightly to $1,342 per ounce,
based on its wave pattern and a Fibonacci projection, said
Reuters market analyst Wang Tao.
For a 24-hour gold technical outlook:
http://graphics.thomsonreuters.com/WT/20112601085945.jpg
On the data front, the United States is scheduled to release
December's new home sales figures.
In addition, the Fed began a two-day meeting on Tuesday that
is expected to end with a nod to an improved economic outlook
but no change in course on its $600 billion bond-buying plan.
"The economic data that investors will be looking at is the
new home sales in December," said Ong Yi Ling, an analyst at
Phillip Futures.
"It may help set the tone of the market. Should we see the
housing market still struggling, it could prompt some investors
to return to gold."
Talks of further interest rate hikes before the Lunar New
Year holiday from Beijing also keeps investors on sidelines of
the market, Ong said.
Some Chinese banks have drastically raised interest rates on
loans to comply with government orders to rein in credit growth
after another lending surge at the start of the year, state
media reported on Wednesday.
India, the world's biggest gold consumer, hiked interest
rates for the seventh time in the past 10 months, leading to the
sharpest fall in commodities in three weeks.
The dollar held near a 10-week low against a basket of
currencies on Wednesday, with the market looking for
confirmation from the Federal Reserve later in the day that its
focus remains on supporting growth.
Spot silver edged up 0.6 percent at $26.99, after
falling to a two-month low of $26.54 on Tuesday.
Holdings in iShares Silver Trust , the world's largest
physically backed exchange-traded fund, declined 30.38 tonnes to
10,447.70 tonnes by Jan 25.
Precious metals prices 0723 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1336.75 4.00 +0.30 -5.83
Spot Silver 26.99 0.15 +0.56 -12.54
Spot Platinum 1781.60 -2.90 -0.16 0.80
Spot Palladium 786.50 7.78 +1.00 -1.63
TOCOM Gold 3532.00 -13.00 -0.37 -5.28 46491
TOCOM Platinum 4756.00 -62.00 -1.29 1.28 18752
TOCOM Silver 71.20 0.20 +0.28 -12.10 1182
TOCOM Palladium 2073.00 -42.00 -1.99 -1.14 1067
Euro/Dollar 1.3671
Dollar/Yen 82.09
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Editing by Ed Lane)
Reuters
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