* Gold's rally likely to extends into the new year
* Gold's target modified to $1,421-technicals[]
* Coming up: U.S. ECRI Weekly index; 1530 GMT
(Adds details, comments; updates prices)
By Rujun Shen
SINGAPORE, Dec 31 (Reuters) - Gold edged up on the last
trading day of the year, gearing towards its strongest annual
gain in three years, supported by a languishing dollar and a
firm outlook for precious metals into 2011.
The precious metals complex has had a stellar run this
year, led by palladium's 94 percent rise, in a broad
commodities rally which has pushed up the 19-commodity
Reuters-Jefferies CRB index up 15 percent.
Spot gold gained 0.3 percent to $1,407.55 an ounce
by 0301 GMT, on course for a 29 percent annual gain and a
fifth straight month of gains. U.S. gold climbed up 0.2
percent to $1,408.3 an ounce.
The dollar held steady against a basket of currencies
. It is about 12 percent lower against the yen and 10
percent down versus the Swiss franc this year.
"It is still a positive picture for metals next year.
There is sufficient demand from investment perspective to
maintain a relatively bullish trend, in gold in particular,"
said Darren Heathcote, head of trading at Investec Australia
in Sydney.
Traders and analysts expect gold to break above $1,500 in
2011.
A bullish target for spot gold is modified to
$1,421 from the previous $1,430-$1,440 range based on its wave
pattern and a Fibonacci retracement analysis, said Reuters
market analyst Wang Tao. []
For a 24-hour gold technical outlook:
http://graphics.thomsonreuters.com/WT/20103112092201.jpg
In a sign that breathes caution into the euphoria, the
holdings in the SPDR Gold Trust , the world's largest
gold-backed exchange-traded fund, fell to 1,280.722 tonnes by
Dec 30, its lowest since early June.
"As an asset class, metals has had an extraordinary year.
If I were a money manager, I probably wouldn't be massively
overweight on metals going into the new year," a
Singapore-based trader said.
"The story is still relatively bullish on metals, but they
ain't cheap. Gold's not cheap."
Spot palladium gained 0.3 percent to $788.22 an
ounce, after rising to a nine-year high of $795.47 on Thursday.
Spot silver was the second best performer in
precious metals, up 82 percent on the year. It was trading at
$30.64, retreating from a 30-year peak of $30.88 hit in the
previous session.
Precious metals prices at 0301 GMT
Metal Last Change Pct chg YTD pct chg
Spot Gold 1407.55 3.56 +0.25 28.46
Spot Silver 30.64 0.20 +0.66 82.06
Spot Platinum 1747.00 3.51 +0.20 19.09
Spot Palladium 788.22 2.25 +0.29 94.38
(Editing by Himani Sarkar)
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