US gold futures briefly rose to an eight-day high early Thursday on fund short covering and scale-up trade buying, but a lack of broader trader interest and some fund selling quickly capped gains. "There has been a lot of action back and forth and we've seen more volume probably than in the last two days," said a COMEX floor broker.
Benchmark June delivery gold was up 40 cents at $429.90 an ounce by 10:35 am on the New York Mercantile Exchange's COMEX division, moving between $428.50 and $431.40, which marked its highest level since March 23. April gained $1.70 to $428.60, dealing within a $426-$429 range.
Much of the early buying was liquidation in the form of speculative short-covering after funds recently made bets the market would sink amid a resurgent dollar, traders said.
Despite a higher euro on Thursday, dealers seemed reluctant to boost gold until Friday's US monthly jobs data yields more clues about future US interest rate increases.
Gold traders barely flinched at remarks by the International Monetary Fund and the US government on possible IMF gold sales to help alleviate Third World debt.
Players also shrugged at word that the European Central Bank sold 47 tonnes of gold, as the sales conformed to a prior agreement and the bank plans no further sales in the coming months.
Spot gold fetched $427.90/8.60 an ounce, above New York's late Wednesday quote at $426.60/7.30. Thursday's afternoon fix in London was at $427.50.
Standard Bank said in a daily note that stiff resistance looms in spot gold at $428, although a break would target the 100-day moving average near $433. It saw support at $422 and the 200-day moving average at $420.
May silver rose 4.8 cents to $7.195 an ounce, trading from $7.11 to a 10-day peak of $7.225. Spot silver reached $7.16/19 versus $7.11/14 previously. It fixed at $7.1875.
July platinum climbed $1.50 to $866.50 an ounce. Spot platinum fetched $866/869. June palladium rose $3 to $203 an ounce. Spot palladium was quoted at $200/203.