Gold Could Retest $1322 Low

Spot Market gold bullion prices fell to two-week lows Friday, drifting lower towards $1440 an ounce during this morning’s London session before dropping sharply through that level, as stocks gained and most commodities fell as the Dollar strengthened against major currencies.

Silver fell to $23.34 an ounce, while copper prices ticked higher.
Heading into the weekend, gold looked set for a 2.2% weekly drop by lunchtime in London, with silver down 2.6% on the week.
The world’s biggest gold exchange traded fund SPDR Gold Trust (ticker GLD) meantime saw the volume of bullion held to back its shares climb to 1054.2 tons yesterday, the first daily addition mid-March.
GLD has seen its holdings fall by more than a fifth since the start of the year, taking them down to four-year lows.
Deutsche Bank became the latest investment bank to cut its gold forecast Friday, with its analysts now projecting a 2013 average gold price of $1533 per ounce, down from the previous forecast of $1637. The 2014 forecast was cut from $1810 an ounce to $1500, with the 2015 forecast down from $1930 to $1450.

On the currency markets, the U.S. Dollar rose above the 100 Japanese Yen mark for the first time in four years Friday. The Dollar also added to gains made against the Euro Thursday, which followed the release of the lowest weekly U.S. initial jobless claims figure since January 2008. Japan’s Nikkei 225 stock market meantime closed up nearly 3% Friday, hitting a five-and-a-half-year high as the Yen weakened against the Dollar.

The Bank of Japan last month announced that it will double the monetary base over the next two years, buying between ¥60-70 trillion of assets a year, after prime minister Shinzo Abe said policymakers will do “everything possible” to achieve an inflation target of 2%.
Gold mining companies meantime reduced their gold hedge positions during the last three months of 2012, according to the latest analysis from precious metals consultancy Thomson Reuters GFMS.