Spot Gold Update

Weak oil weighed on precious metals early on during Friday's trade, but gold bounced off $615/oz for the third time in a week, reinforcing the importance of this support level.

The yellow metal then ground higher as crude recovered some of the day's losses and once gold had regained $620/oz, the market turned quiet for a while. Platinum's recovery from early losses helped gold drive higher in late trading and the metal closed around $622.50, just off the session's high. The story of the day was platinum, however, which hit a two-week low of $1140/oz and then climbed twenty dollars at the afternoon fixing as one player bought about 40koz. Platinum was around $1180/oz at the end of Nymex trading and was firm after the market close.

In Asian trade on Monday, gold edged higher still, while platinum again made solid gains, trading to a high of about $1207/oz. Gold appears to be settling into a solid, if rather wide ranges. Although sagging crude and soft base metals have kept the metal rather heavy, a weaker dollar is preventing the metal from free-falling. Short-dated options sellers are loading the options market with gamma and this is helping reinforce the range.