* Gold drifts lower as oil rally stalls
* Technical outlook weaker; gold seen testing $780-770
* Bernanke says weak outlook demands more fiscal
stimulation
(Updates prices, adds quotes, details)
By Nick Trevethan
SINGAPORE, Oct 21 (Reuters) - Gold drifted lower on
Tuesday, reversing an earlier 1 percent rally after oil markets
trimmed gains and the dollar gained strength.
The picture for other precious metals was mixed, with
platinum following gold lower as last week's selling, which
dragged bullion down 8 percent, resumed after a short break.
Gold <XAU=> fell $1.85, or 0.2 percent, to $793.15 an ounce
at 0610 GMT from New York's notional close on Monday.
"The bias is towards the downside not withstanding the
rally in the past couple of days -- bargain hunting has kept
the market up, but the downside is not over yet," said Adrian
Koh, analyst at Phillip Futures.
"We are looking at $770 to $780 to provide support. If we
move below that we could see $730."
Gold dipped to just above $780 an ounce last week before
bouncing.
Oil <CLc1> pared earlier gains to trade 0.4 percent up to
$74.51 a barrel on Tuesday -- more than $1 off early peaks. Oil
has tumbled more than 50 percent from its peakabove $147 a
barrel. []
The euro fell to $1.3319, having risen to $1.3530 on Monday
<EUR=>. The dollar gained ground overnight on comments by Fed
chief Ben Bernanke urging Congress to throw more money at the
financial crisis. []
Mark Pervan, senior commodities analyst at ANZ said: "The
dollar held back some of the gains in gold. Longer term, we are
pretty comfortable with our call for gold at $800 at the end of
the year."
"Going forward, we will see more volatility and I think
prices will trend lower. What will weigh on gold un the future
is equities. People will be selling gold to pick up what they
see as cheap positions."
The world's largest gold-backed exchange-traded fund, the
SPDR Gold Trust <GLD>, said its bullion holdings slipped on
Oct. 20 by 0.61 tonnes to 756.25 tonnes. Holdings in the trust,
which issues securities backed by physical stocks of gold,
touched a record of 770.64 tonnes on Oct. 13.
Silver <XAG=> rose by 0.9 percent to $9.84 an ounce.
Pervan noted that speculative length in silver had fallen
by 55 percent in the past three months, versus a 40 percent cut
in net length in gold, according to most recent CFTC data.
"Silver has strong potential for long re-positioning. The
longs are well down and we could be seeing a little
rebuilding."
Platinum <XPT=> reversed early gains, dipping 2.4 percent
to $871.00 ounce, down $22 from New York's notional close, when
prices gained 3.6 percent.
Palladium <XPD=> rose 50 cents to $179.00.
Benchmark gold futures on the Tokyo Commodity Exchange
<0#JAU:> fell 37 yen or 1.4 percent to 2,591 yen per gram as of
0638 GMT. Key platinum futures <0#JPL:> were down 88 yen or 3
percent at 2,898 yen per gram.
New York gold futures <GCZ8> rose 0.9 percent to $796.7.
Precious metals prices at 0610 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 793.15 -1.85 -0.23 -4.75
Spot Silver 9.84 0.09 +0.92 -33.38
Spot Platinum 871.00 -22.00 -2.46 -42.70
Spot Palladium 179.00 0.50 +0.28 -51.36
TOCOM Gold 2589.00 -39.00 -1.48 -15.39
37518
TOCOM Platinum 2876.00 -110.00 -3.68 -46.13
14842
TOCOM Silver 319.30 0.80 +0.25 -40.98
586
TOCOM Palladium 604.00 8.00 +1.34 -55.29
216
Euro/Dollar 1.3318
Dollar/Yen 101.47
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Risa Maeda in Tokyo; Editing by
Michael Urquhart)
