* Gold seen tilting to $900 before physical buying sets in
* Gold has broken below 20-day moving average
* Holdings by SPDR Gold ETF fall 1 pct <XAUEXT-NYS-TT>
By Chikako Mogi
TOKYO, July 30 (Reuters) - Gold prices steadied on Thursday,
holding above a two-week low hit the previous day as investors
watched the dollar and stocks to gauge risk appetite.
Gold is now 3 percent below the six-week high hit on Monday,
as U.S. durable goods orders data dampened optimism about an
economic recovery and prompted investors to trim risk assets
including commodities and to buy the dollar as a safe haven.
Given slack physical demand, the market was more likely to
slide towards $900, a level where physical demand has typically
picked up this year, than test the upside, traders said.
"The fact that the market couldn't hold on to $950-$960
levels suggests the market's recent rally was not sustantiated,
given a lack of physical demand," said Yuichi Ikemizu, Tokyo
branch manager at Standard Bank Plc.
"There has been very little sign of such physical buying and
the market will likely extend losses until they step in," which
has been around $900 when big Asian buyers such as India, China
and Vietnam, and even Japan, purchased gold, he said.
Spot gold <XAU=> was at $930.50 per ounce as of 0325 GMT, up
0.2 percent from New York's notional close of $929.00. Gold
prices fell to around $925 on Wednesday, the lowest since July
15, as rising risk aversion boosted the dollar after U.S.
durable goods orders fell more than forecast.
Gold hit a six-week high near $959 per ounce on Monday.
U.S. gold futures for August delivery <GCQ9> inched up 0.3
percent to $930.30 per ounce, compared to $927.20 an ounce on
the COMEX division of the New York Mercantile Exchange. The
COMEX gold range low of $925.20 dated back to July 15 and fell
from a lower high at $940.90 an ounce.
Ikemizu said the market looked long overall, with over 100
tonnes of COMEX long positions estimated currently, although the
amount may have dropped as the market had fallen in the past few
days.
Technically, gold has fallen below the 20-day moving
average, effective around $933 an ounce on Thursday.
Reflecting bearish market sentiment, holdings at the world's
largest gold-backed exchange-traded fund, the SPDR Gold Trust
<GLD>, fell 10.38 tonnes or about 1 percent to 1,072.87 tonnes
as of July 29 from the previous business day.
It was the second day in a row in which holdings had fallen.
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SPDR has shed about 53 tonnes over the past month, the
largest drop ever for the fund.
"The rise in SPDR holdings has been a major factor driving
the market higher and if the fund is now turning around to be a
seller, that would be a major bear factor," Ikemizu said.
The dollar held steady against the euro on Thursday, after
advancing to a two-week high against the single currency the day
before when steep losses in Shanghai's stock market and an
unexpectedly weak U.S. durable goods report bolstered the
greenback's appeal as a safe haven. []
Tokyo shares were flat on Thursday, with caution after
Shanghai shares <> fell 5 percent the day before to post
their biggest daily decline in eight months on concerns that
authorities might take steps to cool the 80 percent gain in
Shanghai shares this year.
Shanghai shares wiped out earlier gains on Thursday.
Precious metals prices at 0321 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 930.30 1.30 +0.14 5.70
Spot Silver 13.32 0.04 +0.30 17.67
Spot Platinum 1165.50 -4.50 -0.38 25.05
Spot Palladium 254.50 2.00 +0.79 37.94
TOCOM Gold 2850.00 14.00 +0.49 10.77 23217
TOCOM Platinum 3573.00 -19.00 -0.53 34.73 9365
TOCOM Silver 408.10 1.10 +0.27 27.81 114
TOCOM Palladium 786.00 7.00 +0.90 42.91 125
Euro/Dollar 1.4054
Dollar/Yen 94.93
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Editing by Michael Watson)
