Gold fell nearly 1 percent, down for a second day on Tuesday after better-than-expected U.S. economic data and easing tensions over North Korea encouraged investors to buy riskier assets, boosting stocks, the U.S. dollar and bond yields.
Gold rose to a two-month high of $1,291.86 on Friday after a week of escalating military threats between Washington and Pyongyang. But fears of conflict eased when North Korean leader Kim Jong Un on Tuesday signalled he would delay a decision on firing missiles towards Guam, a U.S. territory in the Pacific.
Gold's fall accelerated after strong U.S. retail sales in July and strength in an index of business conditions in New York state suggested strong economic growth. The dollar rose to near a three-week high against a basket of currencies on Tuesday. Spot gold was down 0.8 percent at $1,271.58 an ounce, taking losses since Friday's high to nearly 2 percent. Investors await minutes from the Fed's July meeting to be released on Wednesday for clues on when a rate hike is next likely.
On technical front, gold fell for the second straight day, suggesting heavy resistance of key technical level. Currently at $1,272.13, a seesaw can be seen around technical Fibonacci supports. A further retreat will move down the next support to the 100-day moving average of $1,255. Bullion is expected to remain on track the range between $1,200 to $1,300.
Silver underperformed gold on Tuesday. It was down 2.1 percent at $16.65 an ounce, falling below its 100- and 200-day moving averages, and moved down quickly to the support of the 50-day moving average at $16.51. The level will provide some support in the near term. Once breached, the next support can be found at $16.

 
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