Gold futures traded lower Monday, trading below the psychologically important level of $1,500 an ounce as other commodities lost ground.
Gold for August delivery declined $4.40, or 0.3%, to $1,496.50 an ounce on the Comex division of the New York Mercantile Exchange.
“Gold as a commodity is going down,” said Frank Lesh, a broker and futures analyst with FuturePath Trading in Chicago. “The flight-to-safety trade is still alive and well, just being overtaken right now by the commodity-related selling.”
Gold and other metals pared losses and at times traded marginally higher as France’s President Nicolas Sarkozy on Monday endorsed a plan drafted by French banks to extend the maturity of Greek bonds, The Wall Street Journal reported.
In any case, prices are unlikely “to retreat much further” as uncertainty regarding Greece’s sovereign-debt crisis persists, analysts at Commerzbank said in a note to clients .
Traders this week will await for the debate and vote on a further round of austerity measures in Greece, with ratification a condition for the nation receiving additional financial support, they added.
“It is still uncertain whether parliament will give its approval,” the analysts said.
Also helping gold, money managers increased their net long positions, or bets that prices will go higher, to 206,300 contracts in the week ended June 21, according to data from the Commodity Futures Trading Commission.
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