Gold falls again on tapering concerns

                Gold futures traded modestly lower in the early part of Tuesday’s Asian session as tapering concerns continue to loom large. 

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery inched down 0.04% to USD1,326.50 per troy ounce in Asian trading Tuesday. The December contract settled lower by 0.41% at USD1,327.00 per ounce on Monday. 

Gold futures were likely to find support at USD1,291.70 a troy ounce, Wednesday's low, and resistance at USD1,375.10, Thursday's high.

While gold rallied last Thursday on news that the Federal Reserve will not taper its USD85 billion-a-month in bond purchases, the yellow metal and other precious metals have given up all of those gains and then some. 

Ultra-loose monetary policies that include asset purchases drive down interest rates to spur recovery, weakening the dollar in the process and making gold an attractive hedge. 

Some members of the Fed are sending mixed messages regarding tapering, adding an element of confusion to financial markets. On Friday, however, St. Louis Fed President James Bullard said that the U.S. central bank could taper its stimulus program during its October meeting, which sparked a round of profit-taking that sent gold prices falling.

However, on Monday, Federal Reserve Bank of New York President William Dudley said the stimulus program would stay in place until data show that recovery will be sustained. 

"Our decisions on how to adjust our policy tools—for example, the pace of asset purchases and forward guidance with respect to the level of short-term rates—must be rooted in the ongoing flow of information that informs our judgments about the prospects for a sustainable recovery," said Dudley. 

Uncertainty appears to be what is hampering gold at the moment, though may market participants are convinced tapering will happen before year-end with some expecting it will occur next month. 

Elsewhere, Comex silver for December delivery fell 0.18% to USD21.818 while copper for December delivery dropped 0.42% to USD3.284.  - investing.com