Gold prices fell on Wednesday to hover around a four-month low touched in the previous session, as share markets rose and the dollar gained after strong US housing data dampened concerns about an economic slowdown in the country.
The dollar index hovered near a 22-month peak after data showed that sales of new single-family homes in the US rose to a near one-and-a-half-year high in March. The US is expected to beat analyst estimates of a 2.1% rate of growth with the Atlanta Federal Reserve’s GDPNow model projecting growth anywhere between 2.2% and 3.4%.Gold prices were also pressured as Asian shares tracked overnight gains on Wall Street, where both the Nasdaq and S&P 500 indexes marked record closing highs.
“Gold’s key support at $1,280 was taken out some time ago, while compounding the negativity further is the fact that both the 50-day and 100-day moving averages have turned south as well,” INTL FCStone analyst Edward Meir wrote in a note.