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US gold falls on profit-taking, seen to move higher
July 13, 2007 / 3:14 PM / 10 years ago

US gold falls on profit-taking, seen to move higher

 NEW YORK, July 13 (Reuters) - U.S. gold futures retreated by midmorning
Friday on profit-taking, but a weakening dollar and firmer oil prices
limited losses and traders said the yellow metal should rise further in the
near term.
 "Gold will continue to firm up as long as the dollar is weakening the
way it has been," Carlos Perez-Santalla of Hudson River Futures said from
the COMEX floor.
 At 10:57 a.m. EDT (1457 GMT), most-active gold for August delivery
GCQ7 on the COMEX division of the New York Mercantile Exchange was down
$2.40 at $665.90 an ounce, trading between $664.40 and $669.90.
 Investors opted to lock in profits after this week's rally. August gold
on Thursday surged to a peak of $671 which marked the loftiest level since
June 7. Gold futures have rallied more than $20 or 3 percent from last
Thursday's close of $650.60.
 U.S. oil futures rose more than 1 percent to $73.30 per barrel on
supply concerns and speculative buying.
 The dollar continued to slump and touched a record low against the euro
in morning trading. The greenback then retraced some of its early losses.
 The dollar is still on pace for its second-biggest weekly drop of the
year against a basket of major currencies, the dollar index .DXY, which
is down more than 1 pct on the week.
 A weaker dollar makes gold cheaper for investors holding other
currencies. Meanwhile, gold is seen as a hedge against oil-led inflation.
 "I think we are going to see $678 next week..because of the weak
dollar," Perez-Santalla said.
 "The combination of weak dollar and oil driven inflationary concerns
will continue to work in gold's favor," said James Moore, an analyst at
 Moore said that spot gold's next resistance level was seen at $675 and
the precious metal could challenge $690.
 Bullion's rise prompted investors to increase holdings in StreetTRACKS
Gold Shares GLD.N, the No. 1 gold ETF.
 Most recent data showed bullion held by StreetTRACKS XAUEXT-NYS-TT
increased to 484.84 tonnes, more than 20 tonnes higher than 464.22 tonnes
reported last Thursday. An inflow is a bullish signal because it shows that
longer-term investors are entering the bullion market.
 Spot gold XAU= was quoted at $664.30/664.90 an ounce, lower than
$667.00/667.80 late Thursday. The London afternoon gold fix was $666.50.
 COMEX September silver SIU7 was down 6 cents at $13.120 an ounce,
trading between $13.075 and $13.235.
 Spot silver XAG= was quoted at $13.02/13.06 an ounce, compared with
$13.08/13.13 late Thursday. London silver was fixed at $13.125.
 NYMEX October platinum PLV7 fell $5.80 to $1,324.90 an ounce. Spot
platinum XPT= fetched $1,312/1,316 an ounce.
 September palladium PAU7 was also down $2.25 at $370.50 an ounce.
Spot palladium XPD= was quoted at $366/370 an ounce.

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