* Struggles to break out of recent $930 to $960 range
* SPDR holdings mark first rise since July
(Adds comment, updates prices)
By Kylie MacLellan
LONDON, Aug 24 (Reuters) - Gold edged higher on Monday as
oil prices rose and the dollar pared its earlier gains, but
bullion remained rangebound as strong resistance at $960
prevented a more robust rise.
Spot gold <XAU=> was at $955.40 per ounce by 1216 GMT
against $952.65 an ounce late in New York on Friday.
"For now gold just basically a follower," said Ole Hansen,
analyst at Saxo Bank. "The main thing that could drive it
(higher) is the weaker dollar."
A weaker U.S. currency makes dollar price commodities more
expensive for holders of other currencies.
Bullion hit a one week high on Friday as the dollar weakened
with strong U.S. housing sales data and upbeat comments from
Federal Reserve Chairman Ben Bernanke reducing the safe-haven
appeal of the U.S. currency.
Despite initially strengthening on Monday the dollar later
pared its gains, helping push gold prices higher. []
Oil prices also offered support, with the price of crude up
to nearly $74 a barrel on Monday, extending its rally to trade
near a 10-month high, on optimism that an economic recovery will
spur a rebound in energy demand. []
Gold is often bought as a hedge against inflationary
pressures sparked by higher crude prices.
Analysts said gold would continue to take its cue from
movements in the U.S. currency and oil prices over the coming
days, struggling to break through the upper end of its recent
$930 to $960 range.
"Investors still have an appetite for gold but the $960
resistance I think is going to be a pretty tough barrier," said
Robin Bhar, analyst at Calyon. "Gold will continue to struggle
at these upper levels."
In a sign of improving risk appetite, European shares hit
their highest level in more than 10 months in early trade,
buoyed by renewed hopes that the global economic recovery is
gathering pace. []
INVESTOR DEMAND
Gold also took support from a pick up in investor demand,
with holdings of the SPDR Gold Trust <GLD>, the world's largest
gold-backed exchange-traded fund, up 0.92 tonnes on Friday,
marking the first rise since July 16.
Its holdings stood at 1,066.41 tonnes on Friday, up from
1,065.49 tonnes the previous day -- the biggest one-day increase
since June 1, when the holdings rose by 15.27 tonnes to a record
of 1,134.03 tonnes. []
For a graphic on SPDR holdings, click on:
http://graphics.thomsonreuters.com/089/MKT_SPDR0809.gif
Among other precious metals, silver <XAG=> rose to $14.45 an
ounce compared with $14.15 and palladium <XPD> was at $280 from
$278.50.
Platinum <XPT=> dipped to $1,245 an ounce from $1,251.
South Africa's National Union of Mineworkers said on Sunday
it had suspended an indefinite strike set to start on Monday at
the world's No. 2 platinum producer, Impala Platinum <IMPJ.J>,
which could have pushed up prices of the precious metal.
[]
"Platinum has run into profit taking after NUM members
accepted Impala's pay offer, averting strike action set to start
today," James Moore, analyst at thebulliondesk.com said in a
note.
(Editing by Jon Boyle)
