Goldman Sachs's recommendation to short gold, prompted by the bank's belief that the recent fear-induced rally has been overdone, added to the bearish sentiment in the market.
A correction in gold prices had been expected as the metal had risen quickly over a short period of time. It gained $200 from its January lows to its year-high last week, when it also posted its best week since 2011.
On Thursday, gold hit a year-high of $1,260.60 as concerns over the health of the banking sector and fears of a global slowdown prompted investors to steer clear of equities and buy safe-haven gold.

But world stocks rose sharply on Monday as China's central bank fixed the yuan at a much stronger rate and oil cemented recent gains, easing fears of global deflation. Asian shares extended their gains on Tuesday
on a combination of stabilizing Chinese markets, a rebound in oil prices and solid U.S. consumption data. The dollar pulled away from multi-month lows against the yen and the euro, and jumped nearly 1 percent against a basket of major currencies.

Surprise Oil Producers Meeting Scheduled For Today

Oil prices gained on news of a rare private meeting of top officials from the world's biggest oil producers spurred speculation of an eventual deal to tackle a deep supply glut.
Top oil officials from Saudi Arabia, Russia and several key OPEC members will meet on Tuesday for their highest-level discussion in months, a potentially pivotal sign that producers are at last preparing to tackle a devastating supply glut.

The talks in the Qatari capital Doha, which had been kept under wraps until recent days, involve powerful Saudi Oil Minister Ali al-Naimi and his Russian counterpart Alexander Novak, sources said, two figures who must reach an accord for any coordinated
global action to hold any hope of success.

They will be joined by Venezuela's Oil Minister Eulogio Del Pino, who has in recent weeks been visiting major oil producers to rally support for the idea of "freezing" production at current levels in an effort to halt a downward spiral in prices, sources have said.

The agenda for Tuesday's meeting was unclear, and the sources declined to provide any further details on it. Del Pino made no comment on Monday when he arrived in Qatar. Analysts remain cautious, however, that the meeting will result in an agreement.
Saudi Arabia has said it would cut output only if non-OPEC producers agreed to join it.

Russia, the world's top producer, has long refused to cooperate, saying its industry was competitive at any price and it was technically challenging for Moscow to reduce production.

COPPER:
Copper recovered 47 points even after Chinese data disappointed this morning. Comments from the PBOC helped buoy the metal as new stimulus is about to be added by the central bank.

This morning with China’s markets open for business the base metals have rallies strongly with average gains of 1.9 percent, skewed by a 6.3 percent rally in nickel to $8,235. Copper is up 2.5 percent at $4,605, aluminium is up 1.1 percent.

China’s trade data showed copper imports rose 5.3 in January, year-on-year, but were down 17.3 percent month-on-month, while aluminium exports fell 12.1 percent year-on-year and 10.3 percent month-on-month.

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