Yen-based gold futures edged up on Wednesday, supported by the recent weakness of the dollar and lingering geopolitical wariness, but activity was restrained by a computer problem at the Tokyo Commodity Exchange. The key December gold contract closed at a session high of 1,441 yen per gram but failed to break through 1,442 yen, this year's peak matched on Tuesday as traders waited for remarks by Federal Reserve Chairman Alan Greenspan later in the day.
"Gold is still firm and in a bullish trend, but there were few incentives to buy further," said Koji Suzuki, manager at Star Futures Securities.
"People are waiting for a clearer direction in the dollar to judge whether to hold more positions in gold."
Traders said the market's mood was depressed after system problems forced TOCOM to suspend for several hours trading of all gasoline futures contracts for a second straight day.
Because of the glitch, TOCOM imposed temporary trading restrictions that forbid traders from changing bid and offer numbers for orders placed for all other energy and metals futures contracts.
Traders said TOCOM's measures had made fund operators, who trade in large lots, less active. Other gold contracts rose one to five yen. The key December contract closed up five yen from Tuesday's close of 1,436 yen.
Spot bullion was quoted at $425.25/6.00 an ounce against $425.50/6.20 in New York. The dollar was around 105 yen, up from 104.40 yen late in New York, while trading little changed against the euro at $1.3020.
The dollar traded around 106 yen and around $1.2730 against the euro just a week ago. Funds also remained keen to hold positions in gold amid concerns about the nuclear ambitions of North Korea and Iran, traders said.
TOCOM silver futures posted solid gains for the fifth straight session. The December silver contract rose to a two-month high of 243.2 yen per 10 grams as fund operators continued to boost positions in the grey metal.
The daily limit was raised to 10.5 yen from seven yen from Wednesday after most silver futures contracts hit the daily limit high in the past two days. TOCOM silver faced some profit-taking pressure around highs on Wednesday, but sentiment remained strong, traders said. December silver closed 3.6 yen higher at 242.5 yen. It had moved in a range of 239.1 to 243.2 yen. Platinum futures found support after rounds of heavy liquidation sent the key contract below a technically important level of 2,800 yen, traders said.
On Tuesday, key December platinum futures tumbled after hitting a three-month high of 2,884 yen, but failed to hit the closely watched 2,900 yen level, traders said.
December platinum ended at 2,835 yen per gram, up 10 yen from Tuesday's close of 2,825 yen.
It had moved in a range of 2,791 to 2,835 yen. Below are closing prices for TOCOM's most active precious metals contracts, with the day's turnover for each metal.
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