Gold prices eased on Thursday as the dollar advanced in choppy trade and on expectations that the U.S. Federal Reserve will further raise interest rates. New orders for U.S.-made capital goods rose more than expected in November. Other data on Thursday showed that third-quarter U.S. economic growth beat expectations, but the number of Americans applying for unemployment aid hit a six-month high last week and U.S. consumer spending increased modestly in November. Spot gold was down 0.27 pct at $1,128.4 per ounce, and most-active U.S. gold futures for February delivery settled down $2.5, or 0.22 percent, at $1,130.70 per ounce. Despite the current retreat in the dollar, traders have already positioned themselves for a neutral to lower end of the year for gold, with the next support level in the $1,123 area, as the focus remains on the hawkish message of the Fed, which signaled three rate increases in 2017. SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.43 percent to 824.54 tonnes on Wednesday. Holdings are down over 12 percent since November.
On technical front, gold closed in the negative territory for three sessions in a row, but failed to cross below the support of $1,125, remaining rangebound at lows. The RSI index continued to point to oversold range, suggesting mounting correction demand. A rebound is expected in the near term with resistance likely at $1,150.
Silver tracked gold, down 0.94 percent at $15.78 an ounce. Technically, the MACD index pointed to heavy bearish tone with further downward momentum. The level at $15.8 is expected to provide support in near term, but is more and more likely to be breached. The resistance can be found at $16 for the time being.
 

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