Gold settled lower on Monday for a third straight session, as the precious metal encountered resistance amid rising U.S. government bond yields ahead of a Federal Reserve gathering, and even as the dollar softened.
There are no immediate geopolitical concerns to ignite safe-haven demand, while technicals "remain fully bearish on a near-term basis, which continues to invite the chart-based sellers," said Jim Wyckoff, senior market analyst at Kitco, in emailed comments. "Path of least resistance for prices remains sideways to lower."
December gold GCZ8, -0.07% now the most active contract, edged $1.20, or less than 0.1%, lower to close at $1,231.50 an ounce, after gold futures on Friday booked their third weekly decline in a row, with the December contract posting a weekly fall of 0.2%, according to FactSet data. The decline marked the third straight for gold.
September silver SIU8, -0.21% meanwhile, added 4.4 cents, or 0.3%, at $15.537 an ounce, The commodity on Friday posted its seventh straight weekly skid, matching a similar weekly skid in November of 2012, according to WSJ Market Data Group.
Popular funds that track gold and sliver, the SPDR Gold Shares GLD, -0.16% were little changed, while the iShares Silver TrustSLV, +0.07% edged 0.1% higher.
Commodity investors may be watching for fresh clues about the trajectory of central-bank policies, with the Federal Reserve's two-day gathering set to kick off on Tuesday and other notable policy makers, including those at the Bank of Japan and the Bank of England, also scheduled to offer updates, if not alterations, to their policy strategies.
Those factors could influence trading in gold, which has mostly been locked in a downtrend for the past few months.
"Gold's price will depend on the US dollar. Pre-FOMC moves are there. Momentum is very bearish for gold. Buyers are waiting for more correction," said Chintan Karnani, chief market analyst at Insignia Consultants in New Delhi.
He said a further two rate increases by the Fed are likely already factored into the market.
Read: Here's what may be eroding gold's traditional haven status
Strength in the dollar and rising government bond yields have served as headwinds for precious metals in recent months. On Monday, the 10-year Treasury TMUBMUSD10Y, -0.09% hit a yield around 2.99%, until pulling back to around 2.98%. Rates near 3% can potentially cause investors to rethink investments in riskier stocks and havens, like gold, which don't offer a yield.
Meanwhile, a stronger dollar can make assets priced in bucks less attractive to those using other monetary units. As measured by the ICE U.S. Dollar Index DXY, +0.01% a gauge of greenback against a half-dozen rivals, the dollar has gained 2.4% so far this year, although it was sliding by 0.4%
In other metals on Comex, September palladium PAU8, +0.35% added $4, or 0.4%, to settle at $922.50 an ounce, while October platinum PLV8, -0.02% shed 20 cents, or less than 0.1%, to finish at $831.50 an ounce. September copperHGU8, -0.16% gave up a penny, or 0.4%, to end $2.792 a pound.
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