US gold futures extended a recovery from last week's near three-month lows early Tuesday on currency-based buying, as the dollar continued to back-pedal after last week's sharp rally. In other precious metals, silver rose on gold's coattails and platinum and palladium also gained. Traders said gold futures bounced from Friday's lows around $417 an ounce, as market players were inspired by the euro's rebound against the greenback.
"I think the dollar had been oversold, then was bouncing back, and now this is a correction of a correction," said a metals broker at a futures commission merchant.
"But there's no (significant) data out today and volume is about half of what's normal, what with data coming out tomorrow, Thursday and Friday," he said.
By 10:36 am EST, gold for February delivery rose $3.10 to $422.80 an ounce on the New York Mercantile Exchange's COMEX division, dealing from $419.60 to $423.30.
Estimated volume was a very light 14,000 lots by 10 am.
The dollar fell further from recent seven-week highs against the euro as investors braced themselves for Wednesday's US trade data and bought euros on the back of strong German confidence data, trading sources said. But gold remained vulnerable to possible selling in the near-term, analysts said, as the dollar could get a boost from upbeat economic data this week.
Spot gold traded to $421.50/422.25 an ounce, against $419.00/419.50 an ounce late in New York. London's afternoon fix was at $421.35.
Key support in bullion was pegged at $415 an ounce.
Holdings of gold in the US exchange-traded fund street TRACKS, which is backed by bullion, stood at 123.12 tonnes on January 10, a record high since its November 18 launch on the New York Stock Exchange.
COMEX March silver climbed 11.5 cents to $6.565 an ounce, in a range of $6.45-$6.61. Spot silver rose to $6.57/60 from $6.41/44 previously. Tuesday's fix was at $6.5225.
NYMEX April platinum was up $11.60 at $858.50 an ounce. Spot platinum hit $856/861.
March palladium rose 90 cents to $192.50 an ounce. Spot reached $189/194.
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