* Gold turns lower after rising to record, silver retreats
* CME raises silver futures margins by 5.5 percent
* Portugal PM's resignation rekindles euro zone debt fears
* Coming up: U.S. real GDP data on Friday
(Rewrites, adds comment, graphics, updates prices, changes
dateline, previously NEW YORK/LONDON)
By Frank Tang
NEW YORK, March 24 (Reuters) - Gold fell after a brief
rally to a record high on Thursday, snapping a six-session
winning streak, as technical selling more than offset investor
jitters over a European debt crisis due to a politically
unstable Portugal.
Bullion retreated after hitting an all-time peak $1,447.40
an ounce, and silver also pulled back from 31-year high. The
metals were initially underpinned by concerns over the health
of the bloc, violence in the Middle East and North Africa, and
fears over inflation.
"There was no follow-through support after we went to new
highs earlier in the session. It's been basically technical
selling," said Scott Meyers, senior analyst of Pioneer Futures
Inc. "It's what technicians call a reversal day."
Spot gold <XAU=> dropped 0.3 percent to $1,432.35 an ounce
by 2:50 p.m. EDT (1850 GMT). Prior to Thursday's pullback,
bullion has gained about 4 percent during the last six
sessions.
Silver <XAG=> gained 0.5 percent to $37.55 an ounce, having
earlier rose to a 31-year high of $38.13.
Investor sentiment could take a hit after the CME Group
<CME.O> raised silver futures margins by 5.5 percent.
[]
Silver has gained more than 40 percent since late January
on strong industrial demand amid near-term supply tightness.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Take a Look on gold hitting record high: []
Factbox-Gold milestones []
Graphic on gold's reversal day:
http://link.reuters.com/kuz68r
Graphic on relative performance:
http://link.reuters.com/taz68r
Graphic on euro zone crisis: http://r.reuters.com/hyb65p
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TOP REVERSAL DAY
On Thursday, gold charts resembled a top reversal day
pattern, where a new high has been set in an uptrend and is
followed by a close below that of the previous day.
A key reversal day could mark an important turning point on
technical charts. Meyers said, however, gold's decline was a
healthy pullback, setting its stage for further rally into
record highs.
U.S. gold futures for April delivery <GCJ1> settled down
0.2 percent at $1,434.90.
COMEX gold was one of the most actively trading commodity
markets with volume above 200,000 contracts, set for one of the
heaviest trading days in the last two months.
RENEWED EURO ZONE DEBT WORRIES
The return to prominence of euro zone sovereign debt fears,
a key factor pushing gold prices to record levels last year,
has given a fresh boost to both silver and gold on Thursday.
The crisis in the Portuguese government following the
resignation of its prime minister is expected to dominate a
summit of EU leaders on Thursday and Friday, with Lisbon under
intense pressure to seek a bailout package.
"The gold price is currently supported by safe-haven
demand, stemming from three current crises - Libya and more
generally unrest in the Middle East/North Africa region, Japan
and renewed concerns over the periphery of Europe, particularly
Ireland and Portugal," said BNP Paribas analyst Anne-Laure
Tremblay.
Commodity fund managers said that precious metals are also
supported by Wednesday's disappointing new home sales data,
which could lead to an extension of the Fed's $600 billion bond
buying program -- dubbed QE2 because it is the second round of
quantitative easing -- before it is scheduled to end in June.
"The world wants to own any kind of hard assets. There is
plenty of liquidity in the system created by the Fed and by the
Bank of Japan. That money, in the interim, is finding its way
into equities and into gold," said Dennis Gartman, publisher of
the Gartman Letter, a daily investment newsletter.
Last Friday, central banks of the Group of Seven rich
nations coordinated to pour billion of dollars into markets to
depress the value of the yen after Japan's devastating
earthquake and nuclear crisis triggered a yen surge and raised
fears about the global economy.
Market sentiment in platinum group metals, mainly used as
autocatalysts in vehicles, improved after Toyota Motor Corp
<7203.T> said on Thursday it would restart production of three
hybrid models next week after a massive earthquake this month
disrupted output across the industry.
Platinum <XPT=> slipped 0.1 percent to $1,750.50 an ounce,
while palladium <XPD=> gained 0.2 percent to $747.50.
Prices at 2:50 p.m. EDT (1850 GMT)
LAST/ NET PCT YTD
CLOSE CHG CHG CHG
US gold <GCJ1> 1434.90 -3.10 -0.2% 0.9%
US silver <SIK1> 37.375 0.177 0.0% 20.8%
US platinum <PLJ1> 1760.00 0.00 0.0% -1.0%
US palladium <PAM1> 752.25 2.95 0.4% -6.4%
Gold <XAU=> 1432.35 -3.85 -0.3% 0.9%
Silver <XAG=> 37.55 0.19 0.5% 21.7%
Platinum <XPT=> 1750.50 -1.31 -0.1% -1.0%
Palladium <XPD=> 747.50 1.81 0.2% -6.5%
Gold Fix <XAUFIX=> 1447.00 5.75 0.4% 2.6%
Silver Fix <XAGFIX=> 37.78 120.00 3.3% 23.3%
Platinum Fix <XPTFIX=> 1762.00 9.00 0.5% 1.8%
Palladium Fix <XPDFIX=> 758.00 11.00 1.5% -4.2%
(Reporting by Frank Tang and Jan Harvey; Editing by Lisa
Shumaker)
