PRECIOUS-Gold down 1 pct as strong U.S. data dents safe havens
* Rising U.S. home prices, consumer confidence gain weigh * Technical resistance near $1,400 seen capping possible upside * U.S. Mint resumes small American Eagle gold coin sales (Adds market details, updates prices) By Frank Tang NEW YORK, May 28 (Reuters) - Gold fell 1 percent on Tuesday as an equities market rally driven by encouraging U.S. home sales and consumer confidence data decreased bullion's safe-haven appeal. Strong buying of physical bullion on Tuesday, however, briefly reversed gold's fall caused by a dollar rise. "Every time when gold prices drop, we start to see a sharp pick-up in physical demand. Dealers are buying for fear of a sharp correction higher," said Phillip Streible, senior commodities broker at R.J. O'Brien. The metal continued to feel pressure from chart-based sell orders which stopped the recovery after its failure to break above its 14-day moving average near $1,400 an ounce triggered selling. Turnover was higher than usual due to Tuesday's Comex June option expiration and pent-up trading from Monday, traders said. The U.S. market was shut on Monday for the Memorial Day holiday. Spot gold was down 1 percent to $1,380.81 an ounce by 3:25 p.m. EDT (1925 GMT), after trading as low as $1,373.14. U.S. stocks advanced on Tuesday after central banks reassured investors that they will keep policies designed to foster global growth, while prices of other safe havens such as U.S. Treasuries fell sharply. U.S. consumer confidence was the strongest in May in over five years, while home prices accelerated in March by the most in nearly seven years. The reports suggested resilience for an economy despite the pinch of belt-tightening from automatic cuts in federal spending. U.S. Comex gold futures for June delivery settled down $7.70 at $1,378.90 an ounce. Trading volume was near 410,000 lots, preliminary Reuters data showed, set to be the highest turnover since it hit a record on April 15 at about 750,000 contracts. U.S. MINT RESUMES SMALL GOLD COIN SALES The U.S. Mint said on Tuesday it is resuming sales of its small American Eagle gold bullion coins, a month after the price of the precious metal plunged to two-year lows, triggering soaring demand for the coins and depleting the government inventory. The Mint is also lifting allocations - essentially purchase limits for its authorized coin dealers - on the America the Beautiful five-ounce silver coins, effective Tuesday. The moves by the U.S. Mint, one of the world's largest gold and silver coin producers, are a further sign that a coin-buying frenzy has started to fade after investors took advantage of bargain prices following gold's historic two-day sell-off in mid-April. Investment demand in gold remains weak. Holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, were at their lowest since mid-February 2009, falling 0.2 percent to 1,016.16 tonnes on Friday. The fund held 1,350.50 tonnes of gold at the beginning of 2013. Among other precious metals, silver was down 1.7 percent to $22.25 an ounce. Platinum rose 0.6 percent to $1,455.74 an ounce, while palladium gained 2.1 percent to $751.22 an ounce. 3:25 PM EDT LAST/ NET PCT LOW HIGH CURRENT SETTLE CHNG CHNG VOL US Gold JUN 1378.90 -7.70 -0.6 1372.10 1401.00 272,091 US Silver JUL 22.19 -0.303 -1.4 22.110 22.710 47,298 US Plat JUL 1461.80 9.90 0.7 1445.20 1471.00 11,314 US Pall JUN 757.00 30.55 4.2 726.65 764.90 11,390 Gold 1380.81 -13.47 -1.0 1374.28 1399.55 Silver 22.250 -0.380 -1.7 22.180 22.640 Platinum 1455.74 8.24 0.6 1449.25 1467.24 Palladium 751.22 15.22 2.1 730.27 760.97 TOTAL MARKET VOLUME 30-D ATM VOLATILITY CURRENT 30D AVG 250D AVG CURRENT CHG US Gold 407,883 250,431 180,078 23.08 -0.36 US Silver 53,509 77,058 55,503 33.53 -2.58 US Platinum 11,752 12,248 11,854 23.44 -0.13 US Palladium 21,027 6,258 5,171 (Additional reporting by A. Ananthalakshmi in Singapore and Veronica Brown and Silvia Antonioli in London; Editing by Alden Bentley and James Dalgleish)
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