* Potentially bullish “golden cross” nears formation
* European stocks rebound but remain volatile
* SPDR assets rise to highest in nearly a year (Updates prices, adds market comment, second byline, NEW YORK dateline)
NEW YORK/LONDON, Feb 25 (Reuters) - Spot gold rose on Thursday, buoyed by a strong technical formation and the potential for a bullish “golden cross” to form, while the futures market pared losses after feeling earlier pressure from the strong equity markets.
Spot gold was up 0.6 percent at $1,235.70 an ounce at 3:13 p.m. EST (2013 GMT), heading for a third straight day of gains but remaining below the one-year high of $1,260.60 reached on Feb. 11.
U.S. gold futures most-active April contract settled down 30 cents at $1,238.80 per ounce. The discrepancy in price direction between the bullion markets was due to Wednesday’s late-day weakness in the spot market.
“Gold is still holding above that pennant formation. It’s muted as a result of strength in equities,” said Eli Tesfaye, senior market strategist for brokerage RJO Futures in Chicago, referring to gold futures.
A daily chart shows technical buy signals after the markets broke and held above a bullish pennant formation, Tesfaye said.
Spot gold could gain more because it is on the cusp of a key technical level known as the “golden cross”, when the 50-day moving average surpasses the 200-day moving average, analysts said. The gap was less than 50 cents on Thursday.
If the golden cross occurs, it would be the first such formation in almost two years and would be a buy signal for technical traders and momentum-driven investors.
“Gold has put in a very good performance and the fact that we are seeing higher lows and higher highs points to a bullish scenario,” MKS head of trading Afshin Nabavi said.
“Overall buying is safe-haven related ... if we can stabilize around $1,250, a broader range of investors will come in,” he added.
Gold has regained its role as a shelter for risk-averse investors, rising 16 percent this year as global equities have tumbled and fears of an economic slowdown increased.
“The technical picture seems a bit changed and at the same time we don’t expect rate hikes from the Fed anymore ... we expect gold to reach $1,300 by the end of the year,” ABN Amro analyst Georgette Boele said.
An increase in the holdings of bullion-backed exchange-traded funds (ETF) has also supported the rally, with inflows into SPDR Gold Trust rising to the highest since March 2015 on Wednesday.
Among other precious metals, spot silver eased 0.7 percent to $15.14 an ounce, platinum dipped 1.3 percent to $925.50 and palladium fell 0.3 percent to $483.65. (Additional reporting by A.Ananthalakshmi in Singapore; Editing by Alexander Smith and Lisa Shumaker)
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