* Dollar gains traction versus major rivals <.DXY>
* U.S. data watched for dollar direction, NFP in focus
* SPDR holdings <XAUEXT-NYS-TT> up on Wednesday
(updates prices)
By Veronica Brown
LONDON, Oct 1 (Reuters) - Gold eased towards $1,000 per
ounce on Thursday, buckling as the dollar held broad gains, but
moves were limited with investors playing a waiting game ahead
of Friday's key U.S. non-farm payrolls data on Friday.
Spot gold stood at $1,001.60 per ounce at 1510 GMT, compared
with $1,006.70 late in New York on Wednesday.
U.S. gold futures for December delivery <GCZ9> fell $5.40 to
$1,004.00, after rising 1.5 percent on Wednesday.
Silver fell to $16.54 from $16.59 <XAG=>, while platinum
fell to $1,283.00 from $1,295.50 <XPT=> and palladium eased to
$291.50 from $293.50 <XPD=>.
Analysts said that even though prices had eased, the market
still seemed to be showing some resilience despite Thursday's
dollar strength -- staying above key support at $1,000 after
recent sharp losses towards the $984 region.
"Most people have been expecting some kind of correction as
that's what has happened when the market has gone over $1,000.
We're now left wondering whether the recent drop was it," said
Matthew Turner, analyst at VM Group in London.
With currency movements seen as the main driver, major
direction should come in the wake of dollar reaction to economic
data including Friday's key non-farm payrolls report.
The dollar held onto earlier gains against a basket of major
currencies <.DXY> after weekly figures showed the number of U.S.
workers filing claims for jobless benefits rose last week.
[]
Dollar strength tends to make dollar-priced gold less
attractive to non-U.S. investors. The dollar index was last up
0.4 percent.
UNEASE?
Overall dollar weakness, concerns about potential inflation
and technical momentum saw gold prices rise some 8.7 percent in
the three months to September, producing its strongest
performance since the first quarter of 2008.
The latest rally also took prices to within a few dollars of
the March 2008 record high at $1,030.80.
HSBC metals analyst James Steel said in a note to clients
that the market's ability to stay at or near $1,000 was
impressive.
"We believe the deterioration of the USD combined with a
gradual increase in investor risk appetite, is propelling gold
prices higher. Gold appears poised to challenge all-time highs of
USD1,030/oz," Steel said.
But while investors have been happy to go with current
momentum, some unease remains over the market's fundamental
picture and the extent of speculative long positioning.
"Macro-wise I can't see any significant reasons supporting
gold. The data seems to still suggest that we're in quite a
significant deflationary environment," said David Wilson, metals
analyst at SocGen in London.
On investment, the world's largest gold-backed
exchange-traded fund, the SPDR Gold Trust, said its holdings
rose 1.22 tonnes to 1,095.327 tonnes on Wednesday. []
It was the first rise since Sept. 21, when the holdings rose
by 15.256 tonnes to top 1,100 tonnes on a fall in gold prices to
around $995 per ounce.
Further out, banks are remaining positive on gold's ability
to move higher. Deutsche Bank <DBKGn.DE> said gold would move
above $1,100 an ounce during 2010, above the record high of
$1,030.80 an ounce hit in March 2008 [].
(Additional reporting by Risa Maeda in Tokyo; editing by
William Hardy)
