* Gold little changed after 0.6 drop overnight
* Brent back near 11-year lows
* Softer dollar fails to support gold
By A. Ananthalakshmi
SINGAPORE, Dec 29 (Reuters) - Gold struggled to recover from
overnight losses on Tuesday as a relentless slide in oil prices
dented demand for the metal, often seen as an inflation-hedge.
Spot gold XAU= was little changed at $1,070.05 an ounce by
0116 GMT, after losing 0.6 percent in the previous session.
Volumes remained thin in the last trading week of the year.
In the absence of strong trading cues and liquidity, gold is
likely to remain range-bound for the remainder of the week,
tracking oil and currency markets.
"Over the short-term, the precious metal will likely trend
sideways, as funds look to close out the year and contemplate
heading into next year with a fresh slate," said INTL FCStone
analyst Edward Meir.
Gold was sold off on Monday as oil fell more than 3 percent,
with global benchmark Brent back near 11-year lows as last
week's short-covering dried up and players worried that crude
prices had more room to swoon in the new year. O/R
Oil prices were lower in early Asian trading on Tuesday.
Demand for gold slips with oil as the metal is seen as a
hedge against oil-led inflation.
The oil slump more than offset any benefits the metal could
have seen from a slide in the dollar.
The greenback fell to a more than one-week low against a
basket of major currencies on Monday. USD/ A softer dollar
makes dollar-denominated gold cheaper for holders of other
currencies.
With a near 10 percent drop, gold looked set to post its
third straight annual loss, following a 12-year rally that ended
in 2013.
Fundamentals for the metal were not bullish, with the dollar
expected to strengthen as the Federal Reserve hikes U.S.
interest rates gradually next year. Higher rates lowers demand
for non-interest-paying gold.
Assets of SPDR Gold Trust GLD , the top gold-backed
exchange-traded fund, fell 0.18 percent to 643.56 tonnes on
Monday, close to a seven-year low.
Speculators' short positions in COMEX gold contracts are
near an all-time high, though data on Monday showed they had
reduced the record bearish stance in the week to Dec.
22.
The technical picture also looked weak.
A breach of $1,067 an ounce could send the metal all the way
to a multi-year low of $1,048, said ScotiaMocatta.
"December has been a sideways move for the metal with a
series of lower tops. Risk remains lower, we do not see stop
loss buying of the metal until a break of $1,081 and $1,088," it
said.
PRICES AT 0116 GMT
Metal Last Change Pct chg
Spot gold 1070.05 1.4 0.13
Spot silver 13.96 0.04 0.29
Spot platinum 878 -0.74 -0.08
Spot palladium 550 -0.29 -0.05
Comex gold 1069.6 1.3 0.12
Comex silver 13.97 0.086 0.62
COMEX gold and silver contracts show the
most active months
* Brent back near 11-year lows
* Softer dollar fails to support gold
By A. Ananthalakshmi
SINGAPORE, Dec 29 (Reuters) - Gold struggled to recover from
overnight losses on Tuesday as a relentless slide in oil prices
dented demand for the metal, often seen as an inflation-hedge.
Spot gold XAU= was little changed at $1,070.05 an ounce by
0116 GMT, after losing 0.6 percent in the previous session.
Volumes remained thin in the last trading week of the year.
In the absence of strong trading cues and liquidity, gold is
likely to remain range-bound for the remainder of the week,
tracking oil and currency markets.
"Over the short-term, the precious metal will likely trend
sideways, as funds look to close out the year and contemplate
heading into next year with a fresh slate," said INTL FCStone
analyst Edward Meir.
Gold was sold off on Monday as oil fell more than 3 percent,
with global benchmark Brent back near 11-year lows as last
week's short-covering dried up and players worried that crude
prices had more room to swoon in the new year. O/R
Oil prices were lower in early Asian trading on Tuesday.
Demand for gold slips with oil as the metal is seen as a
hedge against oil-led inflation.
The oil slump more than offset any benefits the metal could
have seen from a slide in the dollar.
The greenback fell to a more than one-week low against a
basket of major currencies on Monday. USD/ A softer dollar
makes dollar-denominated gold cheaper for holders of other
currencies.
With a near 10 percent drop, gold looked set to post its
third straight annual loss, following a 12-year rally that ended
in 2013.
Fundamentals for the metal were not bullish, with the dollar
expected to strengthen as the Federal Reserve hikes U.S.
interest rates gradually next year. Higher rates lowers demand
for non-interest-paying gold.
Assets of SPDR Gold Trust GLD , the top gold-backed
exchange-traded fund, fell 0.18 percent to 643.56 tonnes on
Monday, close to a seven-year low.
Speculators' short positions in COMEX gold contracts are
near an all-time high, though data on Monday showed they had
reduced the record bearish stance in the week to Dec.
22.
The technical picture also looked weak.
A breach of $1,067 an ounce could send the metal all the way
to a multi-year low of $1,048, said ScotiaMocatta.
"December has been a sideways move for the metal with a
series of lower tops. Risk remains lower, we do not see stop
loss buying of the metal until a break of $1,081 and $1,088," it
said.
PRICES AT 0116 GMT
Metal Last Change Pct chg
Spot gold 1070.05 1.4 0.13
Spot silver 13.96 0.04 0.29
Spot platinum 878 -0.74 -0.08
Spot palladium 550 -0.29 -0.05
Comex gold 1069.6 1.3 0.12
Comex silver 13.97 0.086 0.62
COMEX gold and silver contracts show the
most active months