(Updates prices)
By Lewa Pardomuan
LONDON, May 23 (Reuters) - Gold bounced on Friday after a
drop from a one-month high spurred buying from bargain hunters,
but jewellers stayed on the sidelines, awaiting clues from the
energy market.
Spot gold <XAU=> firmed to $925.40/926.40 an ounce from
$917.60/918.80 an ounce late in New York on Thursday, when it
jumped to its highest in more than a month at $935.30 before
falling sharply on profit taking and as oil trimmed gains.
"To be honest, probably we are going to remain, obviously,
very volatile," said James Moore, an analyst at
TheBullionDesk.com.
"Certainly sentiment has improved considerably since we were
down below or even struggling to get above $890. I would say
somewhere in the region of $910-$945 would be probably the range
for the week," said Moore, referring to next week's range.
Gold has struggled to sustain the uptrend since spiking to a
lifetime high of $1,030.80 an ounce on March 17, falling to a
four-month low of $845 an ounce in early May as investors booked
profits.
Oil <CLc1> rallied towards $133 a barrel on Friday on a
weaker dollar and persistent worries about stagnating production
in Russia and other countries outside the OPEC group. []
In theory, expensive oil lifts gold's appeal as a hedge
against inflation.
"Resistance is still around the $935-$940 area, so unless we
see a retest of that region soon, we may just head down towards
the $900-$905 supports," said Adrian Koh, an analyst at Philip
Futures in Singapore.
"I think physical buying will probably come around the
supports of $900-$905 levels. But if they think prices will go
up much more, then i think now is a good time."
Gold futures for June delivery <GCM8> on the COMEX division
of the New York Mercantile Exchange added $7.2 an ounce to
$925.5 an ounce.
In other precious metals, platinum regained some footing
after falling from a two-month high the previous day as
speculators booked profits. Spot platinum <XPT=> firmed to
$2,167.00/2,187.00 an ounce from $2,156.50/2,176.50.
"Certainly the fundamentals remain very bullish. Fresh highs
above $2,300 are quite easily on the cards, either in the next
few weeks and certainly the later part of the year," said Moore
of TheBullionDesk.com.
Refiner Johnson Matthey <JMAT.L> said this week platinum
could spike to a record high of $2,500 in 2008 due to
production shortfalls and strong demand, and supplies would
likely struggle disruptions main producer South Africa.
Platinum struck a record of $2,290 an ounce on March 4 due
to power shortage in South Africa which disrupted mining.
On Thursday, state-owned power utility Eskom
warned that the risk of emergency power cuts had increased
significantly due to technical problems. []
Spot silver <XAG=> rose as high as $18.26 an ounce, its
highest level since April 18, to track gains in gold. The metal
was last quoted at $17.92/17.98 late in New York.
Spot palladium <XPD=> was unchanged at $448/456.
(Editing by Pratima Desai)
