Gold had a day of wild sentiment swings to little ultimate effect on Tuesday, originally drifting lower in the far East, spiking sharply in early London trading to its intraday high of $932, falling to the noon hour in New York, rallying back to the end of the Comex, and finally selling off again on the Globex to finish at $924.10/oz., down 80 cents. Overnight, gold has slipped lower.
Platinum traded between $1130 and $1150 from Hong Kong through the New York day, eventually settling near the low end of the range at $1133/oz., down $11. Overnight, platinum is sharply lower.

Silver bumped up to $13.35 just before New York opened, but that was all she wrote as the metal drifted lower pretty steadily through the day, just coming off its intraday lows late in the Globex to close at $13.09/oz., down 16 cents. Overnight, silver is unchanged. (Click here for charts)

It was a pretty blah day, as early strength in all of the precious metals waned as the day wore on, but the results were not a surprise, as there was broad-based selling among both equities and commodities, while crude retreated again and the dollar pushed higher.

Gold’s rally “was tempered by lack of physical demand from the jewelry trade, the Indian imports due to new duty, and the liquidating mode of the markets,” said George Gero, of RBC Capital Markets, covering many of the bases.

In the present market, even among normal gold bugs, optimism is hard to come by. “While the dollar is likely to provide further direction in the short term, we still see gold at risk to further pockets of liquidation from stale longs,” said James Moore, of TheBullionDesk.com.

Moore believes we could see the metal fall below $915/oz. and, at the other end, gold is “seen as capped by resistance up near and beyond the $940 area at the moment,” according to Kitco’s Jon Nadler.

What to watch for out of Washington was suggested by Obama financial advisor Laura D’Andrea Tyson. Though stressing that these were her views and not the administration’s, Tyson said in a speech in Singapore that February’s $787 billion stimulus plan was “a bit too small,” because “the economy is worse than we forecast.”

She thinks that more money should be allocated to transportation infrastructure, conceding that additional government spending raises concerns that “the U.S. will have to inflate away its debt.”

However, “I do not think that is a valid concern,” Tyson said. “The Federal Reserve is not going to let the U.S. government inflate away its debt.”

Source: Precious Metals Edge Lower