Investing.com - Gold prices edged modestly lower on Tuesday, one day after posting its biggest one-day gain in three months, as investors looked ahead to the Federal Reserve's policy meeting due to begin later in the day for stronger clues on when the U.S. central bank will start raising rates.
On the Comex division of the New York Mercantile Exchange, gold futures for June delivery dipped $2.60, or 0.22%, to trade at $1,200.60 a troy ounce during European morning hours. Futures held in a tight range between $1,198.70 and $1,202.00.
On Monday, gold rallied $28.20, or 2.4%, to end at $1,203.20 as a bout of technical buying and short covering lifted prices.
Futures were likely to find support at $1,174.10, the low from April 24, and resistance at $1,209.00, the high from April 20.
Also on the Comex, silver futures for July delivery shed 4.9 cents, or 0.3%, to trade at $16.39 a troy ounce. A day earlier, silver surged 75.9 cents, or 4.84%, to settle at $16.43.
Market participants were looking ahead to the conclusion of the Federal Reserve's two-day monetary policy meeting on Wednesday, which could provide indications over the timing of a future rate hike.
A recent run of disappointing U.S. economic data dampened optimism over the recovery, fuelling speculation the Fed could delay hiking interest rates until late 2015, instead of tightening midyear.
The dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.1% to trade at 97.01 early on Tuesday, moving off the previous session's three-week low of 96.62.
Meanwhile, hopes for a breakthrough on Greece’s debt negotiations were boosted after Greek Prime Minister Alexis Tsipras reshuffled the team handling talks with the country’s international lenders, fuelling optimism that a deal will be reached by early May.
Athens must pay €780 million due to the International Monetary Fund on May 12, fuelling fears that the country could default on its debt be forced out of the euro zone.
Elsewhere in metals trading, copper for July delivery inched down 1.1 cents, or 0.39%, to trade at $2.766 a pound.
Copper rose 2.4 cents, or 0.87%, on Monday to settle at $2.777 amid speculation policymakers in China will have to introduce further stimulus measures to jumpstart the economy amid lackluster growth.
China is the world’s largest copper consumer, accounting for almost 40% of world consumption.