Physical gold bullion prices ticked gently lower as the US session unfolded on Monday.
Lacking both economic data and strong currency-market action, spot gold for immediate delivery slipped to $688.70 by the PM Fix in London.
That was a little over $2 down from the AM Fix.
"There's a lot of resistance at $698," reckons Frank Lesh, a trader at FuturePath LLC in Chicago.
"We are overbought."
Bullish sentiment appears to be waning, however – a sign for contrarian players that this short-term bull run may yet have further to go.
Only half of the 30 traders, analysts and investors surveyed by Bloomberg late last week now expect gold to close this coming Friday higher from April 20th.
Last Friday's close marked the seventh week running of higher gold prices.
"Every dip is becoming a buying opportunity," says Ralph Preston, senior analyst at Heritage West Financial in San Diego.
"I would be amazed if gold does not shatter the $700 resistance level this week."
(Click here for professional technical analysis of gold today...)
Tomorrow and Wednesday will bring fresh news from the US economy. It may offer speculative gold traders just the reasons they need to either push gold higher or take short-term profits.
In particular, professional Fed watchers will be checking the US home sales numbers for signs of lower interest rates ahead. (Could a cut in US rates save the subprime market?)
In the futures market, gold for delivery in June '07 dropped nearly $5 per ounce by late morning in New York, pulling back below $691.10.
"We have profit-taking going on," said George Gero, a vice-president with RBC Capital Markets to Dow Jones newswire.
"Any time you have a large net long position by speculators, they want to pull the trigger if it doesn't go higher."
But selling gold short via the futures market has cost investors dearly since the current rise began on March 5th.
The latest Commitment of Traders report shows large commercial players adding nearly 21,400 contracts to their "short" position in the week ending Tues 17 April – an increase of 14%.
Since then, however, the gold price has moved up to $7 higher per ounce, before retreating to around break-even late in London on Monday at $690 per ounce.
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