Gold futures were falling Thursday as investor optimism decreased demand for the precious metal.

June futures were slipping $16.20 to $884.30 an ounce at the Comex division of the New York Mercantile Exchange. The contract has traded as low as $880.10 and as high as 900.80 so far during the session. Silver futures were down 40 cents to $12.35 an ounce and copper was rising 3 cents to $2.04 a pound.

Gold declined for the second straight month as investors' appetite for risky equities grew as global economies stabilized.

"Aside from the pop from China's central bank purchase, gold prices have been steady under $900", says Jon Nadler, senior analyst at "The broad range of $850 to $950 is still in play. At this point, we will test lower levels of $860 to $870 to see...buyers emerge."

Gold bugs hoped that India's buying festival this week would boost physical demand, but sales were only up 14% on a value basis. The profit was higher because of rising gold prices, but the actual tonnage sold was lower than expected.

Hopes now turn to Mother's Day, typically a big gold jewelry buying event. Sales are expected to be lower by almost 20%.

"Investors are just not spending as much on gold as they did in Q1 of this year or Q3 or Q4 last year", says Nadler. "Incrementally they are holding on to higher levels than in previous years, but the doomsday scenario has stopped playing a role in buying."

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