Golds extends U.S. gains in Asia on dip buying

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Investing.com - Gold futures rose modestly during Wednesday's Asian session, building on gains accrued during Tuesday's U.S. trade as bargain hunters stepped into the market.

On the Comex division of the New York Mercantile Exchange, gold futures for March delivery rose 0.17% to USD1,652.35 per troy ounce in Asian trading Wednesday after settling up 0.05% at USD1,649.85 a troy ounce in U.S. trading on Tuesday.

Gold futures were likely to test support USD1,626.05 a troy ounce, the low from Jan. 4, and resistance at USD1,670.25, Monday's high. Traders may interpret bullion's ability to reclaim the psychologically important USD1,650 an ounce level as a positive near-term sign.

Gold got a lift while the U.S. dollar fell after the G7 nations said they want to allow markets to determine exchange rates and that monetary policy must not be used to weaken currencies. Still, gold trade is suffering from some lethargy as several Asian markets remain closed in observance of the Chinese Lunar New Year, a celebration that is also seen as putting a near-term crimp on demand for physical gold.

Elsewhere, palladium for March delivery added 0.3% to climb to USD774.10 per ounce while platinum for April delivery added 0.63% to USD1,728.40 per ounce. The platinum metals, of which palladium is one, have been stellar performers this year for a variety of factors.

Labor strife in South Africa and expectations that Russian supplies are dwindling have helped lift platinum while the first issue has also proven to be a boon for platinum bulls. South Africa is the world's largest platinum producer and the second-largest of palladium behind Russia.

Robust auto demand, particularly in China and the U.S., has helped lift palladium prices because cars produced in those countries use palladium to make catalytic converters.

Meanwhile, silver for March delivery gained 0.50% to USD31.170 per ounce while copper for March delivery rose 0.11% to USD3.747 per ounce.


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This article appears in: Investing , Forex and Currencies

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