* Spot gold to drop to $1,555 -technicals
* Coming Up: U.S. ICSC weekly chain store sales; 1145 GMT
(Adds premiums in Singapore, updates prices)
By Lewa Pardomuan
SINGAPORE, April 9 Gold pared early losses on
Tuesday as jewellers and speculators looked for bargains, but
the metal was under downward pressure after U.S. stocks gained
ahead of an earnings season that is expected to show modest
Speculators have also slashed their gold net longs as the
precious metal -- typically seen as a safe-haven asset --
ignored tensions on the Korean peninsula and investors moved
their money to equities, seeking better returns, despite
concerns about the health of the U.S. economy.
Gold fell to as low as $1,569.94 an ounce and stood
at $1,576.00 by 0628 GMT, up $ 2.91. It plunged to a 10-month
low last week after an unprecedented monetary stimulus from the
Bank of Japan and hopes for another European Central Bank rate
cut failed to stem heavy selling of bullion by funds.
"I can say the chart point doesn't look good. The bond and
stock markets are more interesting than gold," said Ronald
Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong.
"I think $1,585 is the crucial point. If it can break above
this level, another bull run or short covering will push up the
market to $1,600."
Gold rallied to an 11-month high in October last year after
the U.S. Federal Reserve announced its third round of aggressive
economic stimulus, raising fears the central bank's
money-printing to buy assets will stoke inflation.
Gold has dropped around 6 percent so far this year after
having posted annual gains in the past 12 consecutive years.
U.S. gold for June delivery was at $1,576.10 an
ounce, up $3.60.
Institutional investor George Soros said gold had been
destroyed as a safe-haven asset, but added that he expects
continued central bank buying to support prices, the South China
Morning Post reported.
For a 24-hour gold chart analysis:
"I've seen quite good buying from Thailand after a holiday
yesterday. I would say the purchases are from a mix of buyers,
such as jewellers and speculators," a physical dealer in
"But some say gold may still test below $1,555. So that's
why some people may want to wait for gold to test that level
Despite the buying interest, premiums for gold bars were
little changed in Singapore at $1.20 to the spot London prices,
and dealers were yet to see a pick up in demand in main consumer
India ahead of the wedding season.
In other markets, the yen fell to multi-year lows on the
back of the Bank of Japan's aggressive reflationary campaign,
and shares in Asia drew support from a solid start to the U.S.
quarterly earnings season.
A weak yen lifted the most active gold contract on Tokyo
Commodity Exchange to its highest since Feb. 8 -- not
far off a record high of 5,081 yen a gram hit the same month.
Just like spot gold, Tokyo futures have ignored geopolitical
tensions in North Asia.
North Korea warned foreigners in South Korea on Tuesday to
quit the country because they were at risk in the event of
conflict, the latest threat of war from Pyongyang.
Soaring tensions on the peninsula have been fuelled by North
Korean anger over the imposition of U.N. sanctions after its
last nuclear arms test in February, creating one of the worst
crises since the end of the Korean War in 1953.
"Maybe this guy is too young to be taken seriously," the
physical dealer in Singapore said of North Korea's 30-year-old
leader, Kim Jong-un, in a bid to explain why the tension has not
driven investors to gold.
Precious metals prices 0628 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1576.00 2.91 +0.18 -5.88
Spot Silver 27.40 0.15 +0.55 -9.51
Spot Platinum 1543.25 11.25 +0.73 0.54
Spot Palladium 733.22 3.22 +0.44 5.96
COMEX GOLD JUN3 1576.10 3.60 +0.23 -5.95 12449
COMEX SILVER MAY3 27.36 0.22 +0.80 -9.51 4994
COMEX gold and silver contracts show the most active months
(Editing by Clarence Fernandez and Himani Sarkar)