Gold was initially lower in Hong Kong but traded flat through to the New York open on Tuesday, at which point it plunged about $13 in a half-hour, before riding a gently rising uptrend for the rest of the day, to finish at $893.30/oz., down $12.90. Overnight, gold is slightly higher.

Platinum fared very poorly again, falling from the overseas markets through the first hour in New York, to as low as $1070 before catching a slight updraught, then trading sideways for the rest of the day, and ending at $1091, down $49. Overnight, platinum has been flat.

Silver also traded sideways through Hong Kong after an early plunge, then got taken down through London to late in the New York morning, when it finally perked up to the tune of only about 10 cents, and was flat to a close at $12.49/oz., down 41 cents. Overnight, silver is little changed. (Click here for charts)

The precious metals all took a serious beating yesterday, with platinum (down 4½%) and silver (off better than 3%) leading the way. That wasn’t very good news to fanciers, since the dollar moved lower, which usually creates expectations that gold in particular is going to move higher.

Thus it wasn’t so much a rush into the dollar as it was simply a desire to raise cash on the part of many market participants.

“Cash conservation seems to be foremost in traders’ minds,” said George Gero, a precious-metals trader for RBC Capital Markets. “Sellers in gold, crude, and copper appeared from funds interested in raising cash, concerned with swine flu hurting economies and more uncertain outcome of automobile bailouts.”

The World Health Organization raised a global alert to the highest ever and said swine flu can no longer be contained after spreading to the U.S., Canada, Europe and New Zealand from Mexico.

It may be a little counterintuitive that gold wouldn’t maintain its safe haven status in the face of economic disruptions brought about by the flu outbreak, and it may yet reassert itself in this regard. But the same is not true of silver, which is more tied to industry..

But John Reade of UBS in London pointed out the flip side, that “considering Mexico’s position as the second-largest producer of the metal … supplies could be interrupted if the virus continues to spread.”

Platinum, even more industrial than silver, took the worst beating. “[Yesterday’s] fall-off-a-cliff move in platinum’s price has done serious damage to bull-trending forces,” wrote Ralph Preston, of Heritage West Futures in San Diego. “A push under $1,069 an ounce projects a move down to $1,039 and sets the stage for a test of $1,002 … Only a close over $1,194 an ounce reinvigorates the bulls. Until then, the bears are free to run wild.”

Source: Precious Metals Pounded