* Gold to correct to $1,360-technicals
* TOCOM gold pares losses after quake
* Coming Up: U.S. Retail Sales Feb; 1330 GMT
(Updates prices, adds quake in Tokyo)
By Lewa Pardomuan
SINGAPORE, March 11 (Reuters) - Gold defied weaker oil prices and gained on
Friday after a major earthquake struck northeast Japan and lingering worries
about further unrest in the Middle East supported bullion.
But spot gold remained on track for its biggest weekly decline since late
January, down more than $20 from a lifetime high hit at the start of the week.
Tokyo gold futures on Tokyo Commodity Exchange (TOCOM) pared losses
on safe haven buying after an earthquake of magnitude 8.9 struck Japan,
including capital Tokyo, causing many injuries, fires and a four-metre (13-ft)
tsunami along parts of the country's coastline.
"It's a bad Friday. It's quite a strong tremor but TOCOM is still
operating," said a bullion dealer in Tokyo
Gold added $3.66 to $1,416.25 by 0730 GMT, but a firming U.S. dollar
could also cap gains. Gold hit a record of $1,444.40 on Monday, when investors
poured money into bullion as oil jumped on violence in Libya and after the
downgrade of Greece's credit rating reignited worries about euro zone sovereign
debt.
"We are waiting for some escalation in the situation within Saudi. If
protesters become more aggressive in some way, you might find see more buying
but again, it's being pressured on one side by the dollar," said Darren
Heathcote, head of trading at Investec Australia in Sydney.
"On the one side, we've got, probably, downward pressure as a result of a
stronger dollar and a bit of flight to safety going on. On the other hand,
gold's attractiveness as a safe haven would probably increase, given the
uncertainties surrounding Middle East and particularly what's going on in
Saudi."
Brent crude fell $2 towards $113 on Friday as a quiet start to the planned
"day of rage" in Saudi Arabia eased concern that unrest would spread in the
world's top oil exporter, prompting investors to unwind positions.
U.S. gold futures for April rose $3.9 to $1,416.4 an ounce. The
contract hit record at $1,445.70 on Monday.
Spot gold will fall more next week to a range of $1,360 to $1,376 per
ounce based on its wave pattern and a Fibonacci retracement analysis, according
to Wang Tao, who is a Reuters market analyst for commodities and energy
technicals.
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TAKE A LOOK-Unrest in N. Africa, Mideast
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China's February inflation data, which offered tentative signs the
government is succeeding in tamping price pressures, helped boost gold on
Friday. Soaring inflation in China had sparked worries it could cut the
country's demand for commodities, including gold.
Further monetary tightening to tamp inflation in China however remains a
possibility.
"I think we are still expecting robust demand from China. But I think the
Chinese buying is more on a longer-term basis, so I guess the situation in Saudi
Arabia is still a major factor supporting gold," said a dealer in Singapore.
"There's quite a lot fluidity regarding the situation there. I think there's
a potential for some headline risks."
Silver was steady at $35.28 an ounce, having rallied to a 31-year
peak above $36 on Monday to track rally in gold and also due to a growing
interest in the metal as an alternative investment. Holdings on iShares Silver
Trust were unchanged at a record high at 10,974.06 tonnes.
"We have raised our silver price profile significantly, by 16 percent
to$35.50 an ounce in 2011 and 18 percent to $36.25 an ounce in 2012," said BNP
Paribas in a report. "We expect investment demand to remain strong throughout
the year and the gold/silver ratio to stay in the low 40s."
The yen fell broadly and slumped to a two-week low against the dollar on
Friday after a major earthquake struck Japan and triggered a slide in Japanese
shares.
Asian shares also dropped after the massive quake, darkening an already
bleak mood caused by weak economic data and unrest in Saudi Arabia.
Precious metals prices 0730 GMT
Metal Last Change Pct chg YTD pct chg Turnover
Spot Gold 1416.25 3.66 +0.26 -0.23
Spot Silver 35.28 0.03 +0.09 14.32
Spot Platinum 1767.50 7.26 +0.41 0.00
Spot Palladium 764.97 -0.53 -0.07 -4.32
Euro/Dollar 1.3801
Dollar/Yen 83.04
(Reporting by Lewa Pardomuan; Editing by
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