Off The Wire
PRECIOUS-Gold dips on technical selling and stronger dollar
* Spot gold expected to test resistance at $1,307 -technicals
* SPDR gold holdings fall to near Oct. 9 levels
(Updates prices, adds detail)
By Brijesh Patel
May 16 (Reuters) - Gold prices slipped on Thursday, pressured by technical selling after repeatedly failing to breach $1,300 this week and as the dollar gained on the back of strong economic data from the United States.
Spot gold was down 0.4% at $1,291.47 an ounce at 1301 GMT and U.S. gold futures slipped 0.5% to $1,291.70.
"We have seen repeated attempts in the last few days to rise above $1,300 and it (gold) appears to be facing some kind of barrier. There is clearly some selling when it hits that level," said Capital Economics analyst Ross Strachan.
Adding further pressure to bullion, the dollar index rose after data showed U.S. homebuilding increased more than
expected in April and unemployment benefits fell more than
expected last week, pointing to sustained labour market strength
that should underpin the economy. European equities rose, erasing earlier losses, while the
euro gained in volatile trade as the threat of automotive
tariffs were pushed back. "Gold seems to have reached a temporary detente at these levels with momentum too weak to push it either way. The geopolitical premium appears to be baked into the price for now," OANDA analyst Jeffrey Halley said in a note.
The latest move from Washington to blacklist Chinese telecoms giant Huawei tempered hopes of a breakthrough in an escalating trade conflict that has rattled financial markets and compounded fears of a slowdown in global growth after weak economic data from China. "The ongoing trade tensions between the two largest economies and an increasing potential for a more negative growth scenario should be supportive for gold," Capital Economics' Strachan added.
On the technical front, spot gold is expected to test resistance at $1,307, a break above which could lead to a gain to $1,322, said Reuters technical analyst Wang Tao. Meanwhile, SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, said holdings fell 0.4% to 733.23 tonnes on Wednesday. Holdings are now close to their lowest levels since Oct. 9. Among other metals, silver was down 0.4 % at $14.74 an ounce while platinum fell 0.2% to $843.65.
Palladium lost 1% to $1,331.30 and has slumped by about 17 percent since the metal used in catalytic converters in car exhaust systems scaled a record peak of $1,620.53 in March.
"At the movement it (palladium) seems to be consolidating after a hefty decline," Strachan said. "The bigger picture for palladium is still substantial weakness in autos demand."
(Reporting by Brijesh Patel in Bengaluru Editing by David Goodman)5832, Outside U.S. +91 8067493865; Reuters Messaging: Brijesh.Patel1.firstname.lastname@example.org))