* Gold flat but remains near $1,274.75 an ounce record
* Firmer dollar holds prices back, technical moves seen
* Coming Up: U.S. industrial output for Aug 1315 GMT
(Updates prices, adds detail/comment)
By Michael Taylor
LONDON, Sept 15 (Reuters) - Spot gold traded flat on
Wednesday, hovering near record highs hit in the previous
session, as investor buying and lingering doubts about the
global economy offset a firm dollar.
Spot gold <XAU=> was little changed at $1,269.75 an ounce by
1155 GMT, after having surged more than 2 percent to a record
$1,274.75 an ounce in the previous session, its biggest one-day
gain in four months. U.S. gold futures for December delivery
<GCZ0> were little-changed at $1,271.50.
"The investment demand has risen," said Eugen Weinberg,
analyst at Commerzbank. "I wouldn't be surprised if gold goes to
$1,300 but it will not be done on any fundamental demand, but
more on technicals.
"I cannot rule it out, given the positive chart situation
and relatively strong demand from investors."
According analysts' research, gold support is at $1,250 and
resistance at $1,280, while silver support is at $20.00 and
resistance at $20.60.
Weinberg also said U.S. industrial production data due out
at 1315 GMT on Wednesday may move precious metal prices.
Bullion is now on course for a rise of about 16 percent in
2010, fuelled largely by investor nervousness after the fallout
from the euro zone debt crisis and from concerns about the pace
of global economic recovery.
$1,300?
On Tuesday, respected metals consultancy GFMS Ltd said in
its Gold Survey 2010 Update, that gold could rally above $1,300
this year, as uncertainty about economic recovery and a
sovereign debt crisis stoke investment interest. []
"Prices hit a record yesterday as the dollar weakened and
forecasts from the GFMS suggested that central banks would be
net buyers this year for the first time since 1988," investment
bank Fairfax said in a note.
"As a shortage of supply in the market now looks likely to
continue, prices look likely to climb further."
U.S. short-term rates remained steady at low levels on
Tuesday, anchored by the Federal Reserve's determination to keep
rates down, likely making gold attractive as an investment.
[]
The world's largest gold-backed exchange-traded fund, SPDR
Gold Trust <GLD.P>, said its holdings rose to 1,298.698 tonnes
by Sept. 14 from 1,292.619 tonnes by Sept. 13. The holdings hit
a record at 1,320.436 tonnes on June 29. []
Although the gold price has held within a few dollars of
record highs for a few weeks, the market is also in the full
throes of the buying season in some of the world's biggest
consumers.
"It is playing a role," Weinberg said. "Traditional demand
from India in the third and fourth quarter is relatively high.
The current high levels are not very attractive for Indian
buyers, and I wouldn't be surprised to see jewellery demand
falling further."
AngloGold Ashanti Ltd <ANGJ.J>, the world's third-largest
gold miner, plans to remove its gold hedge book -- one of the
biggest among its global peers -- by early 2011. []
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Graphic on gold's rise to record high:
http://graphics.thomsonreuters.com/F/09/CMD_GLDHGH0910.gif
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Among other markets, the dollar jumped more than two yen
from a 15-year low after Japan intervened to sell yen for the
first time in six years, but with key chart levels yet to break,
traders were sceptical the impact would be lasting. []
Gold has long served investors as an alternative to volatile
currencies, equities or sovereign bonds, that investors will
swiftly punish.
"Slow western world growth and the likelihood of interest
rates in the major economic remaining on hold for some
time, have boosted demand," Citi said in a note. "However, if
equity markets continue to gain and the dollar holds its own,
Gold could struggle to set new highs."
Spot silver <XAG=> rose to $20.52 an ounce, the highest
level in two and a half years, before easing to $20.46 an ounce.
Platinum <XPT=> hit $1,601.50 an ounce, the highest since
June 21, before softening to $1,582, versus $1,586.30 at the
previous close.
Palladium <XPD=>, which is predominantly used in the
production of auto catalysts, traded at $548.50 from $547.75,
after earlier touching $553 on Tuesday, the highest since
end-April.
(Editing by Sue Thomas)
