Gold price falls 1.5% to wipe out weekly gain

San Francisco (Feb 26)  Gold futures settled sharply lower Friday, with strength in the U.S. dollar and recent gains in oil prices prompting prices to more than erase what would have been a gain for the week.

April gold GCJ6, -1.23% dropped $18.40, or 1.5%, to settle at $1,220.40 an ounce—for a weekly loss of roughly 0.8%. But for the month, it’s on track for a gain of about 9.3%, which would be its strongest since January 2012, according to FactSet data.

“Gold’s rally has been impressive so far” but if April gold closes below $1,210, “it’s likely headed back to the $1,180 area,” said Michael Armbruster, principal and co-founder at Altavest.

“That being said, we think gold has made a significant bottom and that the longer-term trend has turned up,” he said. “In other words, we view a pullback to $1,180 as a buying opportunity.”

Read: ‘Gold is the new black’ with best start to a year since 1980

Prices for the metal on Friday, however, took a hit as the U.S. dollar DXY, +0.68%  strengthened. The greenback found support after a raft of data was seen as pushing back against the idea that the U.S. economy is headed toward recession. A stronger dollar can dull demand for dollar-denominated gold.

U.S. data released Friday showed that the longer-term rate of inflation nearly doubled in January to 1.3%, while the annual pace of domestic economic growth in the fourth quarter was marked up slightly to 1%. The data also helped provide support for the U.S. stock market, but key stock indexes were mixed by the time gold prices settled.

Meanwhile, crude-oil futures CLJ6, -0.64% ended the week more than 3% higher, which has taken away some of investor attention away from gold, but oil was seesawing between losses and gains just ahead of Friday’s settlement on the New York Mercantile Exchange.

Silver for March delivery SIH6, -3.03%  also fell by 48.1 cents, or 3.2%, to $14.689 an ounce. For the week, it was down about 4.5%.

High-grade copper for March delivery HGH6, +2.15%  tacked on 5.2 cents, or 2.5%, to $2.118 a pound, for a weekly gain of roughly 2%. April platinum PLJ6, -1.33%  skidded $11.90, or 1.3%, to $915.10 an ounce and March palladium PAH6, +0.03%  shed $1.30, or 0.3%, to $482.10 an ounce with both metals ending more than 3% lower on the week.

Source: MarketWatch