COMEX gold slipped early Wednesday as the dollar firmed, but inflation hedge buying supported prices near one-month highs above $400 an ounce as New York oil prices rose above $47 a barrel for the first time.
"Keep an eye on crude," said one gold floor broker. "Right now were just playing in this area. The trend is still bullish."
At 9:19 am EDT (1319 GMT), December gold was off $1.30 at $405.40, peaking at $407 then cutting losses after a dip to $404.80.
On Tuesday, the benchmark contract reached $407.70, its highest level since July 20. Sentiment is improving for gold, which has benefited from worries about stagnant growth, rising inflation and a weak dollar as well as the threat of al Qaeda attacks on the United States before the November presidential election.
Anxiety is high in New York City before the Republican Party convention, which starts August 30.
Spot gold fetched $403.20/70, off from the close at $404.20/70. Wednesdays morning fix in London was $403.20.
September silver slipped off 7.0 cents at $6.66 an ounce, trading in a $6.74-$6.63 range. Spot silver fetched $6.63/66, down from $6.70/73. The fix was at $6.695.
NYMEX October platinum tumbled $21.40 to $858, continuing to recoil from a 17-week high on Monday. Spot platinum last fetched $855.00/860.00.
September palladium was 65 cents easier at $218 an ounce. Spot palladium was quoted at $217.00/222.00.