Gold News & Info

Source: Reuters

New York— Gold futures ended higher on speculative and trade buying in light volume on Monday, as the dollar fell against rival currencies, making dollar-priced bullion cheaper for overseas traders, dealers said.

Gains in gold and in copper helped lift industrial precious metals too, with silver, platinum and palladium also rising.

August gold on the COMEX division of the New York Mercantile Exchange climbed $2.50 to close at $426.30 an ounce, after moving from $423.80 to $427.40 and holding atop Friday's five-week low at $422.30.

Gold took its cue from a rally in the euro, traders said, after choppy trade last week following Thursday's bombings in London and Friday's weaker-than-expected U.S. payrolls data.

A big drop in COMEX open interest recently also cleared out stale positions and created a potential buying opportunity in gold with prices below $425, said market watchers.

"Demand is pretty strong down here in the $420s," James Turk, founder of online gold trading Web site GoldMoney.com, said. "And, considering that the summer months are normally slow, the fact that we're seeing strong physical support here is good too."

Part of the buying was likely fund short covering after open interest fell 5,224 lots to 270,440 contracts as of July 8, way down from over 300,000 lots around a week ago.

Final estimated COMEX gold volume was a sleepy 36,000 lots, versus Friday's official tally of 50,530 contracts.

The dollar fell Monday in technically-driven trade as markets looked ahead to U.S. May trade data later this week.

Luxembourg approved the EU constitution in a weekend referendum, which supported the euro, while sterling rose as the market saw a limited economic impact from last week's bombings in London, analysts said.

The euro rose to $1.2064 by midafternoon, up 0.7 percent from late Friday, after hitting a 14-month low at $1.1866 last week.

CFTC Commitments of Traders data from Friday showed funds in COMEX gold futures sold 25,057 contracts in the week ended last Tuesday, leaving them net long 104,874 lots.

IFR Markets analyst Tim Evans put support, basis August futures, at $423.90-424.50 and then at $422.30 and $415.80, with resistance seen at $430.10 and $435.30.

Spot gold firmed to $425.35/5.85 an ounce, up from Friday's late New York quote at $422.70/3.40. Monday's morning fix in London was at $425.

September silver climbed 7.5 cents to end at $7.105 an ounce, after trading from $7.02 to $7.13. Spot silver hit $7.07/7.10 from $6.98/7.01 previously. It fixed at $7.04.

October platinum was up $5.60 at $867.80 an ounce. Spot platinum last fetched $867/871.

September palladium rose 15 cents to settle at $185.75 an ounce. Spot traded at $183/186.