* SPDR holdings fall again, hitting lowest since 2008
* U.S. gold futures fall over 1 pct, down 10th day
* Coming up: U.S. existing home sales at 1400 GMT
(Updates prices)
By Manolo Serapio Jr
MANILA, July 22 (Reuters) - Gold fell on Wednesday for a
seventh session in eight, reflecting sustained downward pressure
on the metal days after its steepest drop in almost two years,
with more losses seen ahead as the demand outlook dims.
A looming hike in U.S. interest rates has dented gold's
appeal as an investment, encouraging more sellers in the market
after Monday's 4-percent rout. Holdings in top gold fund SPDR
Gold Trust dropped further, marking their lowest since 2008.
"The long-term downtrend is still in place and more people
are selling," said Mark To, head of research at Hong Kong's Wing
Fung Financial Group.
"We can't see any bullish factor. Inflation is well
contained and we don't see a systemic crisis that might push
people to buy gold."
Spot gold XAU= fell 0.7 percent to $1,093.71 an ounce by
0610 GMT.
It touched a session low of $1,090.55, just shy of Monday's
trough of $1,088.05 - its lowest since March 2010 - following a
selloff exacerbated by huge volumes traded on the Shanghai Gold
Exchange.
The Shanghai rout happened after investors dumped more than
$500 million worth of bullion in New York in four seconds during
the early Asian trading hours, when typically only tens of
contracts of gold are traded. ID:nL1N10203C
U.S. gold for August delivery GCcv1 was down 0.8 percent
at $1,094.20 an ounce, after falling as much as 1.3 percent,
marking its 10th consecutive session of losses.
Physical demand has been sluggish despite this week's steep
price drop.
India is not rushing to pick up slack Chinese demand as
would-be buyers wait for further price declines, with a wedding
season lull and poor rains curbing appetites. ID:nL3N10135T
"The next price target may be $1,000. That's a sensitive
level but it would not be surprising to see a test of the power
of that support," said To.
Holdings in SPDR Gold Trust GLD , the world's largest
gold-backed exchange-traded fund, fell further to 22.17 million
ounces on Tuesday, the lowest since August 2008.
"Gold and by association, the precious metals complex, has
done itself no favours ... over the last couple of days, and a
market that was already in the doldrums, will find it hard to
recover any lustre in the near future," wrote David Govett, head
of precious metals at broker Marex Spectron.
Spot platinum XPT= was down almost 1 percent at $969.20 an
ounce and palladium XPD= fell a similar degree to $620, both
trading near multi-year lows. Silver XAG= eased 0.5 percent to
$14.75 an ounce.