Gold drops as bulls start to fade after January’s big rally

Madrid (Feb 3)  The lackluster performance in gold this week continued on Tuesday, with prices continuing to pull back from January’s 8% rally, the precious metal in three years.

At last check, gold for February delivery GCG5, -1.26% fell $11.40, or 0.9%, to $1,265.60 an ounce. March silver futures SIH5, -0.73% rose 3 cents to $17.28 an ounce.

Jim Wyckoff, senior analyst at Kitco.com, said on Twitter that lack of fresh bullish news were among factors taking a dent out of gold prices. “Bulls fading and need to show power soon,” he said.

A day earlier, gold was flat, though some analysts believe the pieces are still in place to support further strength in gold prices. David Govett, precious metals analysts at Marex Spectron, however, is looking for gold to remain stuck in a range between $1,250 and $1,300.

“Gold is one of those emotive markets where people get overly excited both at the top and bottom of the market and this generally ends badly,” Govett said. “If one can actually accept the fact that range trading quite often works, then all the better. In the absence of any negative or positive news, I will stick with that for the time being.”

On the economic front, auto sales flood in throughout the day, while factory orders for December will be released at 10:00 a.m. Eastern. The jobs report lurks at the end of the week.

In other metals, platinum for April delivery PLJ5, -0.10%  jumped $2.40 to $1,230.90 an ounce, while March palladium PAH5, +0.10%  gained $4, or 0.5%, to $792 an ounce.

High-grade copper for March delivery HGH5, +2.85%  added 7 cents, or 2.7%, to $2.56 a pound.

Source: MarketWatch