Gold prices erased last week's gain versus the Dollar Monday morning in London, briefly trading below $1183 per ounce as the US currency extended its recovery from mid-March's drop.
Silver also erased last week's Dollar gain, falling almost 4% from Thursday's 1-month high to $16.75 per ounce.
Commodities cut earlier losses, but US crude oil held 7% beneath Thursday's sudden peak as world stock markets gained.
China's main stock index jumped 2.6% to hit fresh 7-year highs after central bank governor Zhou Xiaochuan said Beijing's bureaucrats "have room to act" on boosting growth, which has slowed "a bit" too much.
Less educated investors are piling into Chinese shares using margin accounts according to analysis gathered together by the Sober Look blog.
Major government bond prices also rose Monday, nudging 10-year US Treasury bond yields 1 basis-point lower to 1.95%, below the start of March's 2.03% and down from 2.17% at New Year.
Compared to gold's movement with the Euro or crude oil prices, "Gold's negative correlation with US Treasury yields is still the most dominant," says a technical analysis from Japanese trading house and London bullion market maker Mitsui Global Precious Metals.
"Yields look like being well supported around 1.80%," the note goes on, targeting 2.40% or above "if bond prices weaken on a succession of decent US data."
Wednesday this week brings the private-sector ADP estimate of US jobs hiring for March.
The Bureau of Labor Statistics then releases its estimate of US non-farm payrolls, the jobless rate, and average earnings on Friday – when London's bullion dealers, as well as European and US stock markets, will be closed for the long Easter weekend.
"The weekly candle is somewhat bearish," says a chart reading on gold prices from London market maker Scotia Mocatta – a division of Canada's ScotiaBank – pointing to last week's "sizeable upper shadow" above Friday's closing level.
Also "neutral" on gold prices overall, technical analysis from French investment and bullion bank Societe Generale says that "short term gold has achieved our earlier target of $1223 and is showing a retracement...likely to be confined to $1172."
Last Thursday's surge in gold prices near $1220 per ounce "was nothing more sinister than short covering," reckons brokerage Marex Spectron's London bullion head David Govett.
"Short holdings by [managed money] funds had risen to the highest figure since data began in 2006. Last week's [price] rise was in response to this...[and] was not the beginning of a sustained upward move."
Latest data from US regulator the CFTC show speculative traders growing their bearish 'short' betting against gold for the 7th week running in the week ending last Tuesday.
That growth came despite the previous week's sharp rise in gold prices, the fastest since late January, as the Dollar fell following a softer-than-expected view on raising interest rates from the US Federal Reserve.
Last week's total speculative short position reached "84% of the all-time high [and was] the most elevated since November," says Japanese conglomerate Mitsubishi's analyst Jonathan Butler, "suggesting there is still potential for a covering rally" if prices rise, forcing bearish traders to close their bets.
Related:
Interview with Adrian Ash on London Gold Fix, Manipulation, and Chinese Banks
