Gold rose back above $1,600 an ounce on Tuesday, gathering momentum as it pushed through key levels, while the euro hit session highs against the dollar and other commodities firmed, with copper prices moving higher and crude oil paring gains. Spot gold was up 0.5 percent at $1,602.45 an ounce at 1342 GMT, off an earlier low of $1,586.29. US gold futures for August delivery were up $5.30 an ounce at $1,591.50.
The euro briefly rose back above $1.25 just before the US open, recovering early losses made on concerns over Spain's bank bailout deal and uncertainty after Greek elections this Sunday, although trading was choppy.
"(We had) a small pop higher in the euro and that was it," Saxo Bank vice president Ole Hansen said. "The market wants to go higher now and it has taken comfort from the fact that buyers returned fairly quickly after the sell-off last week." Prices fell below $1,600 an ounce on Thursday as expectations for a fresh round of potentially dollar-negative quantitative easing in the United States, sparked by very weak jobs data, dissipated.
"Gold is sitting waiting for something to happen, but I would argue it is waiting for something to happen in the United States, rather than Europe," Natixis analyst Nic Brown said. Technical analysts, who study past price moves to determine the next direction of trade, identify strong resistance for gold near $1,609. Barclays Capital said in a note that it sees near-term support at $1,579, and is neutral on gold in the medium term.
"Selling interest near $1,650 keeps gold within the seasonal mid-year range," it said. "While $1,520 underpins, we look for a move above $1,700 to signal further upside toward $1,800." Among other precious metals, silver was up 1.2 percent at $28.85 an ounce. Holdings of silver-backed exchange-traded funds monitored by Reuters rose by 570,000 ounces from June 10 to June 11, Reuters data showed, after an inflow into the Julius Baer Physical Silver fund.
Spot platinum was down 0.1 percent at $1,435.49 an ounce, while spot palladium was down 0.1 percent at $616.75 an ounce. Platinum prices are failing to benefit from fresh concerns over South African output of the metal, despite Monday's announcement that number four platinum miner Aquarius Platinum would suspend operations at its Marikana joint venture. "Prices will need to recover to around $2,000 an ounce to justify further investments in the industry and restart suspended operations at the Marikana platinum mine," investment bank Fairfax said in a note.