* Gold under more pressure as dollar rises
* Role as a safe-haven investment in doubt
* Silver, PGMs also lower
* Coming up: U.S. ADP national employment April; 1215 GMT
(Adds details)
By James Regan
SYDNEY, May 5 (Reuters) - Gold gave up its safe-haven
status to the dollar on Wednesday, continuing to give up ground
after dropping sharply overnight in step with a broad sell-off
in commodities and stocks.
Gold is being grouped with risky investments that have been
sold off amid worries over Greece's aid package and the ability
of other eurozone countries to keep clear of the contagion.
However the dollar, considered a safe haven investment
mainly through the purchase of U.S. treasuries, remains in
favour.
"The dollar's taking the steam out of gold again today,"
said a bullion dealer in Sydney, adding that the greenback's
surge had caused investors with long gold positions to
liquidate.
"Right now it's a currency play more than anything else."
Spot gold <XAU=> was quoted at $1,167.15 at 0330 GMT versus
Tuesday's notional close of $1,170.65. Bullion hit a session
low on Tuesday of $1,166.66 an ounce, versus its day peak of
$1,191.90 an ounce -- the highest since Dec. 4.
U.S. gold futures for June delivery <GCM0> on the COMEX
division of the NYMEX were quoted at $1,168.00 versus Tuesday's
settlement price of 1,169.20.
Gold has failed at trend line resistance at $1,183 per
ounce, and is expected to retrace towards support at $1,160.88,
based on Reuters analysis. []
A drop below $1,160 signals gold could retrace further to
the lower trend line support at $1,156.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
For a graphic showing the gold technical outlook, see:
http://graphics.thomsonreuters.com/gfx/WT_20100405165107.jpg
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
News on Tuesday that the International Monetary Fund sold
18.5 tonnes of gold in March versus 5.6 tonnes in February also
acted as negative. []
The euro sank to fresh one-year lows on Wednesday as a
sell-off in the single currency gathered momentum, with
sentiment bearish as fears about contagion in the euro zone
gripped investors. The U.S. dollar index <=USD> <.DXY> rose
0.18 percent, on top of a 1.4 percent rise on Tuesday.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
For a graphic showing gold's performance in currencies other
than the U.S. dollar, click on:
http://graphics.thomsonreuters.com/10/GLD_CRRJH0510.gif
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
Greece has signed up to a package of austerity measures
designed to cut its deficit by 11 percentage points between
2009 and 2014, an aim that will deepen the recession and could
spark a social backlash.
The measures agreed this weekend with the EU and IMF
include more tax hikes and steeper cuts in wages and bonuses,
in return for a record 110 billion euro ($146.5 billion)
bailout. []
Oil was also down on the rising dollar, heading towards $82
a barrel and extending the steepest one-day percentage loss in
three months on Tuesday.
With the dollar gaining more ground, investors were shying
away from gold. Earlier this week, they had been buying bullion
on concerns that a 110 billion euro bailout for Greece may not
be enough to resolve its financial crisis, and that other euro
zone economies like Spain may also be hit by debt problems.
Investors dumped stocks across Asia after Wall Street on
Tuesday recorded its worst session in three months.
Silver prices <XAG=> dropped a further 27 cents to $17.61
an ounce. Platinum <XPT=> fell $13 to $1,664.50 an ounce, while
palladium <XPD=> was $2.50 lower at $511.00.
Silver, platinum and palladium all posted their biggest
one-day losses since February.
Precious metals prices.
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1168.10 -2.55 -0.22 6.61
Spot Silver 17.64 -0.20 -1.12 4.81
Spot Platinum 1668.50 0.00 +0.00 13.74
Spot Palladium 511.00 -4.50 -0.87 26.02
TOCOM Gold 3581.00 26.00 +0.73 9.88
17217
TOCOM Platinum 5260.00 22.00 +0.42 19.95
3844
TOCOM Silver 57.00 0.60 +1.06 10.25
84
TOCOM Palladium 1664.00 -1.00 -0.06 42.83
138
Euro/Dollar 1.2964
Dollar/Yen 94.80 TOCOM prices in yen per gram, except
TOCOM silver which is priced in yen per 10 grams. Spot prices
in $ per ounce.
(Editing by Ed Lane)
