* Silver, platinum and palladium return to positive
territory
* Gold rangebound, biased to rise-technicals []
* Coming up: U.S. Chicago Midwest, November; 1700 GMT
(Adds comment; updates prices)
By Rujun Shen
SINGAPORE, Dec 27 (Reuters) - Spot gold regained lost
ground on Monday, as bargain hunting trickled in after prices
dropped about one percent in early trade in response to
China's interest rate increase on Saturday.
Spot gold fell to a one-week low of $1,371.10,
before recovering to $1,384.80 an ounce by 0545 GMT, up 55
cents from the previous close.
U.S. gold futures pulled back from a 0.4-percent
decline to $1,386.2, up 0.4 percent.
"Earlier speculators were selling on China's rate hike
news, but a lot of buying has since emerged as speculators are
buying on dip," said a Tokyo-based dealer.
Spot gold is technically neutral as it is rangebound
between $1,360 and $1,392 per ounce, but the bias seems to be
with the bulls, Reuters market analyst Wang Tao said.
For a 24-hour gold technical outlook:
http://graphics.thomsonreuters.com/WT/20102712093133.jpg
Spot silver fell as much as 1.6 percent to a
one-week low of $28.75 an ounce, and recovered to $29.24 an
ounce, up 0.1 percent.
Spot platinum gained 0.7 percent to $1,734.50 an
ounce, and palladium rose by one percent to $760.97,
both reversing early losses.
China's central bank raised interest rates on Saturday for
the second time in just over two months as it stepped up its
battle to rein in stubbornly high inflation. []
"The market had been worried about more tightening moves
from China. Now that the news is out, it almost came as a
relief," said Li Ning, an analyst at Shanghai CIFCO Futures.
Commodity markets pared early losses after the initial
selling-off, focusing instead on positive fundamentals and
threats to supply.
Robust physical demand in the region was seen supporting
the sentiment in the precious metals market.
"Some speculators liquidated their positions earlier, but
we also see very good physical demand in the market today,"
said Peter Fung, head of dealing department at Wing Fung
Precious Metals in Hong Kong.
Fung expected the rate hike to pressure gold prices in the
short term, but physical buying is expected to emerge once
prices dip below $1,370.
"Gold is likely to be traded in the range of $1,360 to
$1,390. In the medium-term, gold is still looking up," Fung
said.
Thin trade at the year-end tends to exaggerate price
moves, traders also said.
The dollar edged down against a basket of currencies on
Monday.
PRICES
Precious metals prices at 0545 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1384.80 0.55 +0.04 26.38
Spot Silver 29.24 0.03 +0.10 73.74
Spot Platinum 1734.50 12.00 +0.70 18.23
Spot Palladium 760.97 7.97 +1.06 87.66
TOCOM Gold 3700.00 -8.00 -0.22 13.53 37028
TOCOM Platinum 4683.00 0.00 +0.00 6.89 14298
TOCOM Silver 78.10 -0.20 -0.26 51.06 1523
TOCOM Palladium 2040.00 5.00 +0.25 75.11 752
Euro/Dollar 1.3122
Dollar/Yen 82.78
TOCOM prices in yen per gram. Spot prices in $ per ounce.
(Editing by Himani Sarkar)
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