Gold futures in New York advanced on Friday morning, boosted by an flat US dollar and steady oil price, as financial markets seemed to reverse course from the extreme moves early in the week.
Bargain hunting and technical buying supported the yellow asset, trading sources said. Gold had fallen for seven straight sessions before bouncing on Thursday from a three-month low near $546 an ounce.
Gold rose more than 2 percent early Friday, but ongoing choppiness in currencies and energy and uncertainty about the short-term positioning by the big funds was capping gains.
"Gold must prove its case at levels above $585, and above $640, to provide confidence of the type that is required to resume its bull run," Jon Nadler, an analyst with bullion dealer Kitco, said.
"If the negative bias re-emerges, and does so with the swiftness and energy it recently exhibited, then the price compass will inevitably point to a range of from $490 to $540," he wrote in a daily note.
By 10:34 am EDT, August delivery gold climbed 1.35 percent, or $7.70, to $578 an ounce on the New York Mercantile Exchange's COMEX division, trading from $571.20 to $589, which marked its highest level since Tuesday. Futures dropped more than 7 percent that day and then slid to a three-month low of $546.40 on Wednesday, before steadying at the end of the day.
The pullback came as investors' aversion to risk and a desire for liquidity pressured a range of financial markets, analysts said.
COMEX gold shot to a 26-year high of $732 last month, before being slammed by profit taking.
Spot gold rose to $574.40/575.10 an ounce, versus Thursday's New York close at $566.50/567.50. Friday's afternoon bullion fix in London reached $574. COMEX July silver was up 11 cents at $10.08 an ounce, in a range of $9.96 to $10.37. On Wednesday, silver slumped to a four-month low of $9.45.
Spot silver fetched $10.08/10.18 an ounce, up from $10.00/10.10. Silver fixed at $10.28. At NYMEX, July platinum was down $5.70 at $1,155.20 an ounce. It hit a two-month low of $1,095 this week. Spot platinum was off at $1,155/1,159.
September palladium rose to $307 an ounce, a gain of $1.20. It dropped on Wednesday to a four-month low of $267.10. Spot changed hands at $302/307.
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