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PRECIOUS-Gold down from 7-wk high on dollar strength, technical swing
January 13, 2017 / 3:15 AM / a year ago

PRECIOUS-Gold down from 7-wk high on dollar strength, technical swing

* Spot gold may retrace steps back to $1,172 -technicals
    * Silver off near 1-mth highs hit in prior session
    * Platinum off 2-mth peaks touched day before

 (Adds comment, updates prices)
    By Sethuraman N R
    Jan 13 (Reuters) - Gold fell on Friday after hitting a
seven-week peak in the previous session as the dollar edged up
and a technical correction set in, but it was still set to end
higher for a third straight week.
    Spot gold had dropped 0.2 percent to $1,193.66 per
ounce by 0603 GMT. It touched its strongest since Nov. 23 at
$1,206.98 on Thursday.
    U.S. gold futures eased 0.5 percent to $1,193.80 per
ounce.
    "Currently we see that gold is overbought and needs some
technical correction," said Jiang Shu, chief analyst at Shandong
Gold Group.
    He added that prices could fall towards $1,170 an ounce
before climbing above $1,210, although they may decline again in
the run up to a March meeting of the U.S Federal Reserve.
    Reuters technical analyst Wang Tao said spot gold faced a
strong resistance zone of $1,205-$1,210 per ounce, and may
retrace steps back towards support at $1,172.  
    The dollar index, which measures the greenback
against a basket of currencies, rose 0.1 percent to 101.440.
 
    Fed Chair Janet Yellen did not comment on the outlook for
the U.S. economy or monetary policy in remarks to teachers this
week. 
    However, several Fed officials on Thursday cautioned that
the fiscal and tax plans sketched out by the incoming Trump
administration could spur a short-term economic boost that would
result in longer-run inflation and debt problems. 
    The statements by Fed officials could imply tighter U.S.
monetary policies and were bearish for gold, said HSBC analyst
James Steel.
    Trump's campaign calls for tax cuts and more infrastructure
spending have boosted U.S. shares and the dollar, as well as
driving a sell-off in Treasuries, but his protectionist
statements and a flurry of off-the-cuff posts on Twitter have
kept many investors from adding to risky positions.
    Among other precious metals, spot silver fell 0.3
percent at $16.65, after hitting a near one-month high of $16.92
in the previous session.
    Platinum dropped 0.3 percent to $969.25. It touched a
2-month high of $990.10 in the prior session.
    Palladium declined 0.7 percent to $751.58.

 (Reporting by Nallur Sethuraman in Bengaluru; Editing by
Kenneth Maxwell and Joseph Radford)

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