Gold declined slowly between the London and New York opens on Monday, plunged in the first hour of Comex trading, rallied back to where it started by early afternoon, but then reversed direction again, from there to late Globex trading, finally finishing the volatile day at $736.10, down $6.20. Overnight, gold is little changed.

Platinum blasted to $858 in Hong Kong, but that was decisively that, as it fell sharply into the New York open, then traded sideways to end at $802/oz., down $31. Overnight, platinum has edged higher.

Silver got onto the same rollercoaster as gold, pushing as high as $9.65, then falling nearly 40 cents, clawing back up to $9.45, but finally pulling back again to close at $9.23/oz., down 24 cents. Overnight, silver is trending higher. (Click here for charts)

It was another disappointing day for the precious metals, especially gold as it failed to generate any lasting support from a weaker dollar. But with plunging equities markets and sliding oil, there wasn’t much buying enthusiasm to be found anywhere.

Gold seems to be hunting for something to fall as a result of.

Yesterday, oil factored in, but, “Uncharacteristically, gold lately seems to be moving up and down with the stock market,” says Jeffrey Nichols, of American Precious Metals Advisors.

“Gold is still a tail being wagged by stocks,” said Frank McGhee, of Integrated Brokerage Services in Chicago. “Gold has been sold down to support equity losses. With some pressure coming off stocks, gold can move higher. Stocks just have to stop sliding.”

Despite the drop in the buck, it remains, somewhat perplexingly, a perceived safe haven as “people are pulling their money home and going to cash,” says Frank Lesh, of FuturePath Trading in Chicago. “ There’s a loss in demand for all metals and commodities.”

UBS has turned pessimistic, projecting that gold will average only $700 next year, after averaging $882 in 2008. “Long-term investors in gold should reduce holdings,” UBS wrote. “Disinflation and a stronger dollar will mean gold is unlikely to perform well over the next year or two. We forecast higher gold prices over the next three months. But for this to materialize, the recent dollar strength will need to abate.”

That’s something that may not happen quite so soon, but happen it will, as the massive monetary inflation being pumped into the system begins to have an effect.

Source: Gold Slides As Equities Plunge Again

Last 5 posts by Doug Casey

• Resource Stock Roundup:Monday, July 27, 2009 - July 27th, 2009
• Base Metals Higher - July 27th, 2009
• Crude Continues to Climb - July 27th, 2009
• Dollar Moves Lower - July 27th, 2009
• Gold Pushes Through $950 - July 27th, 2009