MTECHTIPS:-Gold drops to 4-month low ahead of U.S. GDP report
Gold prices declined for the third consecutive session to hit a four-month low on Thursday, as caution set in ahead of U.S. first quarter gross domestic product data, due later in the day.On the Comex division of the New York Mercantile Exchange, goldfor August delivery fell to a session low of $1,251.90 a troy ounce, the weakest level since February 4, before trimming losses to last trade at $1,252.30 during European morning hours, down 0.59%, or $7.40. Gold prices were likely to find support at $1,247.80 an ounce, the low from February 4 and resistance at $1,294.70, the high from May 27. U.S. GDP is expected to be revised to a negative print, as an unusually harsh winter weighed on the economy. Market analysts expect the data to reveal a contraction of 0.5% in the first three months of the year instead of a 0.1% increase as originally reported. The U.S. will also publish the weekly government report on initial jobless claims as well as data on pending home sales for April. Comex gold prices have been under heavy selling pressure in recent weeks as upbeat U.S. economic data underlined the view that the U.S. economy is shaking off the effects of a weather-related slowdown over the winter, bolstering the outlook for the broader economic recovery. Wall Street expects second quarter growth to snap back with a 3.8% gain. Gold lost 0.47%, or $6.00 on Wednesday to end at $1,259.70 as investors were hesitant to buy into the market amid a weak technical outlook.