* Precious metals broadly rebound after Friday's tumble
* Dollar weakness, short covering cited
* ETF Securities' Physical Platinum ETC holdings drop 30
pct
(Recasts, updates with quotes, closing prices, market
activity, adds NEW YORK to dateline)
By Frank Tang and Jan Harvey
NEW YORK/LONDON, Aug 18 (Reuters) - Gold ended more than 1
percent higher on Monday, closing just a hair below $800 an
ounce on the back of a weaker dollar and in what traders said
may be the beginning of a bounce back from recent declines.
Spot gold <XAU=> was at $799.65/801.05 by New York's last
quote at 2:15 p.m. EDT (1815 GMT), up from $787.65/789.25 late
on Friday in New York but off its session high of $803.65.
Jonathan Jossen, COMEX options floor trader in New York,
said that the gold options market is currently signaling that
the upcoming week could be volatile, partly because of a lack
of market players during the summer sessions.
"We should bounce after the market was being sold off so
drastically," Jossen said.
He said that a buying opportunity might arise when the euro
rises above $1.48, and market participants could start
"shorting" if gold futures dropped below $795 an ounce.
The euro was quoted higher at $1.4695 against the dollar,
as currency traders took profits after the U.S. currency's
recent sharp rally. []
Gold typically moves in the opposite direction to the U.S.
currency as it is often bought as a hedge against dollar
weakness.
U.S. gold futures for December delivery <GCZ8> settled up
$13.60, or 1.7 percent, at $805.70 an ounce on the COMEX
division of New York Mercantile Exchange.
The yellow metal climbed more than 2 percent to above $800
an ounce in Asia trading sessions as the dollar slipped and oil
climbed, triggering a wave of short covering.
"We are seeing people jump from gold into the U.S. dollar
again," said Philip Carlsson, global product manager for
futures and options at Saxo Bank.
A wave of short-covering inspired by the weaker dollar and
some bargain hunting after gold slipped $70 an ounce last week
pushed prices higher early on Monday.
FEWER NET LONG POSITIONS
But the precious metal is susceptible to further downward
moves if the dollar resumes its upward trend, analysts say.
According to data released on Friday by the U.S. Commodity
Futures Trading Commission, traders are tending to close out
long positions, or commitments to buy.
Noncommercial net longs in gold futures were 130,660
contracts in the week up to August 12, down 20 percent from a
net long of 163,728 lots a week earlier. []
"The marked decline in gold prices in recent weeks is
reflected in optimism among speculative non-commercials
fading," Commerzbank analysts said in a note.
Platinum also firmed more than 5 percent in Asian trade,
but has since slipped back to trade little changed. The market
remains under pressure from fears over demand from carmakers,
which consume over half of the world's platinum every year.
London-based ETF Securities said holdings of its Physical
Platinum <PHPT.L> exchange-traded commodity, which issues
securities backed by physical metal, fell 30 percent in the
week to Sunday, to their lowest level since February.
[]
"Long liquidation remains the game in the PGM space, and
rallies it seems will struggle to last while marooned ETF
investors in particular look for opportunities to bail," said
JP Morgan analyst Michael Jansen in a note.
Platinum <XPT=> was trading at $1,386.00/1,406.00 an ounce,
up slightly from $1,365.00/1,385.00 late in New York on Friday.
Earlier it reached a session high of $1,438.00.
Meanwhile, spot palladium <XPD=> was trading at
$283.00/291.00, higher than $281.00/289.00 late in New York on
Friday.
Among other precious metals, spot silver <XAG=> was
initially up nearly 4 percent. It ended at $13.10/13.15 an
ounce against its precious U.S. finish of $12.74/12.84.
