* Gold pressured as strong US home sales data lifts stocks
* Safe-haven demand fades after European bank stress tests
* Coming Up: U.S. Case/Shiller housing index due Tuesday
(Recasts, updates prices to market close)
By Frank Tang
NEW YORK, July 26 (Reuters) - Gold fell on Monday after
strong U.S. home sales data boosted equities and limited the
precious metal's safe-haven appeal, but prices remaining below
$1,200 an ounce drew physical demand, limiting losses.
The metal was hovering just above an upward trend support,
but analysts said a sharp price decline could happen in an
overly bullish gold futures market held up largely by
short-term, speculative investors.
Bullion was pressured as U.S. stocks gained ground after
data showed sales of new U.S. single-family homes rebounded in
June from May's record low. [] []
Spot gold <XAU=> was at $1,181.45 an ounce by 3:08 p.m. EDT
(1908 GMT), down from $1,189.05 late on Friday. In the previous
session gold briefly crossed $1,200 before finishing lower.
Gold lost some safe-haven appeal after Friday's European
banks stress test showed no nasty surprises.
Robin Bhar, an analyst at Credit Agricole, said that gold
could still benefit from financial uncertainty despite easing
worries about debt held by banks.
"The factors pushing gold haven't gone away," said Bhar,
citing sovereign debt, the outlook for inflation and the
devaluation of currencies.
The metal was sharply below the lifetime high had reached
$1,264.90 in early June.
U.S. gold futures for August delivery <GCQ0> settled down
$4.70 at $1,183.10 an ounce.
Money managers cut their long, or bullish exposure, to U.S.
gold futures by 18 percent for the week to July 20 as the
metal's prices hit two-month lows, U.S. CFTC's trade data
showed. []
Still, Rick Bensignor, chief market strategist at
investment banking group Execution Noble, said that the
noncommercial long-to-gold ratio was at a very high 5-to-1.
"That's why we are warning of extreme caution on long
positions. The only significant buyers on the way down will be
commercials covering shorts, when and if they choose to,"
Bensignor said.
Gold was trading at less than $5 above at its 100-day
moving average at $1,181 an ounce, but some analysts suggested
the metal was near a natural entry point as prices fell toward
its long-term upward trend support. (Graphic:
http://link.reuters.com/fyc69m)
Analysts also said that activity on the physical market
could pick up in August with the start of the festival season
in major jewelry consumer India. []
The gold market now turns its focus on the S&P/Case-Shiller
20-city home price index due Tuesday, which is seen up 4.0
percent year-over-year in May, following a series of mixed U.S.
housing reports recently.
PLATINUM/PALLADIUM RALLY
Platinum earlier rose to its strongest in a month on fund
buying driven by gains in equities. []
Platinum <XPT=> reached as high as $1,552.50 an ounce, its
highest since late June, and was at $1,550.50 an ounce versus
$1,539.45 on Friday.
Palladium <XPD=> hit a session high of $476 an ounce, its
highest since June 28, and was at $470.50 an ounce versus
$464.55.
Analysts see platinum prices rising as a recovering
automobile industry boosts demand for the auto catalyst metal,
but the optimism has lessened after a hefty correction in May,
a Reuters poll showed. []
Silver <XAG=> was at $18.14 versus $18.08 on Friday.
Prices at 3:15 p.m. EDT (1915 GMT)
LAST/ NET PCT YTD
CLOSE CHG CHG CHG
US gold <GCQ0> 1183.10 -4.70 -0.4% 7.9%
US silver <SIU0> 18.200 0.099 0.0% 8.0%
US platinum <PLV0> 1555.80 13.00 0.8% 5.8%
US palladium <PAU0> 475.00 8.25 1.8% 16.2%
Gold <XAU=> 1181.35 -7.70 -0.6% 7.8%
Silver <XAG=> 18.14 0.06 0.3% 7.7%
Platinum <XPT=> 1547.00 7.55 0.5% 5.6%
Palladium <XPD=> 470.50 5.95 1.3% 16.0%
Gold Fix <XAUFIX=> 1183.50 -5.50 -0.5% 7.2%
Silver Fix <XAGFIX=> 18.01 -16.00 -0.9% 6.0%
Platinum Fix <XPTFIX=> 1546.00 5.00 0.3% 5.5%
Palladium Fix <XPDFIX=> 477.00 1.00 0.2% 18.7%
(Additional reporting by Rebekah Curtis in London, Lewa
Pardomuan in Singapore; Editing by David Gregorio and Lisa
Shumaker)
