Gold goes higher while euro loses ground (Reuters) (14-01-2011)

SINGAPORE – Bullion showed gains on Friday on euro losing gains though debt auctions by Spain and Italy were better than forecast while purchases from jewellers and investors offered additional support.

Spot gold rose $3.95 to $1,376.70 an ounce by 0505 GMT after trading in a choppy $23 range on Thursday. Bullion struck a lifetime high around $1,430 an ounce in December on fears the euro debt crisis would spread.

U.S. gold futures for February fell $10.1 to $1,376.9 an ounce to track weakness in U.S. crude oil futures, but the decline was ignored by players in the cash market.

Gold bars were offered at premiums of $3 an ounce to spot London prices in Hong Kong, and at $1.5 in Singapore.

The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings fell to 1,265.093 metric tons by Jan 13 from 1,271.467 metric tons on Jan 11.

According to a Reuters analysis, gold is expected to fall to $1,352.30 per ounce, as the rebound from this level could have completed, and a bullish target at $1,407 is aborted.

Silver bounced after falling more than 3 percent in the previous session, while platinum and palladium held near their multi-year highs on the prospect of more demand from investors and the industrial sector.

Source: Reuters