* Gold falls below $1,190, then bounces
* For the technical on gold, click []
* Coming Up: U.S. Fed Chairman Bernanke testifies; 1800
GMT
(Updates prices)
By Lewa Pardomuan
SINGAPORE, July 21 (Reuters) - Gold edged down on Wednesday
as investors shifted some of their money into firming equities,
while a drop in ETF holdings could prompt more selling as
bullion struggles to hold above $1,190 an ounce.
Although purchases from jewellers offered some support,
trading was thin ahead of euro zone bank stress test results
this week, which some analysts say could soothe concerns about
how European banks would cope with deterioration in the
region's economy and financial markets.
Gold <XAU=>, which hit an intraday low of $1,188.35 an
ounce, fell $2.60 to $1,188.80 by 0537 GMT. It dropped to a
two-month low at $1,175.35 on Tuesday before rebounding sharply
to above $1,190 on chart-based buying. Gold struck a record in
late June on worries the European debt crisis would spread.
For a 24-hour spot gold technical outlook, see:
http://graphics.thomsonreuters.com/WT/20102107091033.jpg
"I think the market is heading south for the short term.
Only a weakening dollar can push up the market a little bit. If
it can't break (above) $1,200 in the coming days, it will test
the downside one more time," said Ronald Leung, director of Lee
Cheong Gold Dealers in Hong Kong.
"I would say, it would gradually fall to $1,150," said
Leung, referring to a level last seen in late April.
U.S. gold futures for August delivery <GCQ0> dropped $3 to
$1,188.7 an ounce.
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD.P> said its holdings fell nearly 0.5 percent to
1,308.128 tonnes by July 20 from 1,314.211 on July 15. The
holdings hit a record at 1,320.436 tonnes on June 29.
[]
"The market is relatively quiet. Buying from Thailand
continues but I must say they are not really active," said a
physical dealer in Singapore. "Premiums for gold bars are
stable at 80 cents."
Asian stocks rose on Wednesday as investors cheered Apple's
strong earnings and on optimism that China may roll back policy
tightening measures later this year. The MSCI index of Asia
Pacific ex-Japan stocks <.MIAPJ0000PUS> rose 0.4 percent.
[]
The euro inched up against the dollar ahead of euro zone
bank stress test results on Friday and U.S. Federal Reserve
Chairman Ben Bernanke's semi-annual testimony before Congress
on Wednesday and Thursday, with investors waiting for comments
that could boost speculation about easier monetary policies.
[]
"The upside is kept at a recent high $1,194, but I think
the market lacks direction. The market is waiting for the
stress result in Europe," said a dealer in Hong Kong. "I still
have bearish views on the market even though it has rebounded
from recent lows."
Europe's assessment of how 91 banks would cope with another
economic downturn aims to restore market confidence after the
Greek crisis sparked fears the euro zone could unravel and
leave banks nursing major losses on government debt.
[]
Precious metals prices at 0537 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 1188.80 -2.60 -0.22 8.50
Spot Silver 17.64 -0.01 -0.06 4.81
Spot Platinum 1500.25 -12.70 -0.84 2.27
Spot Palladium 444.93 -4.60 -1.02 9.72
TOCOM Gold 3343.00 20.00 +0.60 2.58
35579
TOCOM Platinum 4248.00 -14.00 -0.33 -3.04
12508
TOCOM Silver 50.00 -0.30 -0.60 -3.29
419
TOCOM Palladium 1259.00 7.00 +0.56 8.07
232
Euro/Dollar 1.2875
Dollar/Yen 87.17
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Editing by Ed Lane)
