* 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>
(Updates prices)
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 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 risky 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 onto the $950-$960
levels suggests the market's recent rally was not
substantiated, 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 $930.30 per ounce as of 0547 GMT,
up 0.14 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 $929.9 per ounce, compared with $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. []
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 fell against a basket of currencies on Thursday
after China's central bank said it would stick to a loose
monetary policy to consolidate an economic recovery, easing
market worries about the nation's growth. []
It advanced to a two-week high against the euro 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.
Shanghai shares <> fell 5 percent on Wednesday 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.
Japan's Nikkei average edged down 0.1 percent on Thursday,
with caution after the Chinese stock tumble offset a surge for
Honda Motor Co <7267.T> and Nissan Motor Co <7201.T> on
surprise quarterly profits. []
Precious metals prices at 0545 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 930.30 1.30 +0.14 5.70
Spot Silver 13.30 0.02 +0.15 17.49
Spot Platinum 1163.50 -6.50 -0.56 24.84
Spot Palladium 254.50 2.00 +0.79 37.94
TOCOM Gold 2852.00 16.00 +0.56 10.84
27509
TOCOM Platinum 3571.00 -21.00 -0.58 34.65
11363
TOCOM Silver 406.10 -0.90 -0.22 27.18
150
TOCOM Palladium 785.00 6.00 +0.77 42.73
147
Euro/Dollar 1.4066
Dollar/Yen 95.06
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 Miho Yoshikawa)
