Gold Commodity holds on to overnight losses as risk-on mood drags

"Longer term, there are plenty of uncertainties to support gold prices but without an immediate catalyst, gold prices may drift to $1,300."

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24 karat gold bars are seen at the United States West Point Mint facility in West Point, New York play 24 karat gold bars are seen at the United States West Point Mint facility in West Point, New York June 5, 2013. (REUTERS/Shannon Stapleton/File Photo)
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Gold was mostly unchanged on Tuesday, holding on to its losses from the previous session as a pickup in investor appetite for risky assets capped demand for the precious metal.

Gold shed almost a percent on Monday, when stock markets in the United States logged record highs amid hopes that a decline in U.S. corporate earnings was bottoming out - dragging on bullion's safe-haven appeal.

As of 0645 GMT on Tuesday, spot gold was up 0.1 percent at $1,330 an ounce, while U.S. gold was 0.1 percent higher at $1,330.80 an ounce.

"It's that allure of risk-on environment that we are in which is weighing on the gold prices. What we saw on Monday was a bit of a reaction to Friday's solid U.S. retail numbers," said Dominic Schnider of UBS Wealth Management in Hong Kong.

"We shouldn't forget that people have already piled in tremendously, be it the futures or the ETFs. So for me it's a consolidation that is happening in gold right now."

Gold has risen almost 25 percent this year, with recent gains being driven by an uncertainty stemming from Britain's decision to leave the European Union and a Turkey coup bid.

"With Turkey no longer dominating events, investors are likely to revert to the U.S. dollar, bond yields, and risk sentiment," HSBC analyst James Steel said in a note.

"Longer term, there are plenty of uncertainties to support gold prices but without an immediate catalyst, gold prices may drift to $1,300."

Technical charts also suggest a bearish target at $1,313 for spot gold, Reuters technical analyst Wang Tao said.

However, holdings in SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, firmed 0.25 percent to 965.22 tonnes on Monday.

Investors are now waiting for the outcome of the European Central Bank meeting on Thursday for further cues.

"There is talk of some further accommodation being doled out, in which case we could see gold moving a little higher from here," said INTL FCStone analyst Edward Meir. "If the ECB holds back, the selling could resume, with a test of key support at $1,308 possibly being in the cards and needing to hold."

Among other precious metals, silver fell 0.5 percent to $19.91 an ounce, down for a fourth straight session.

Platinum and palladium were down 0.4 and 0.3 percent at $1,087.74 and $641.90 an ounce, respectively.

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