* Gold rises to less than $10 under all-time high
* SPDR gold ETF holdings drop for first time since April
* Gold could fall 40 pct from peak - Robert Prechter
* Coming up: U.S. April consumer confidence data on Tues
(Recasts, updates prices to market close, adds comment,
changes dateline, previous LONDON)
By Frank Tang
NEW YORK, June 7 (Reuters) - Gold rallied to less than $10
below its all-time high on Monday, as funds piled in for safety
amid choppy currency and equity markets due to ongoing fears
about euro zone credit contagion.
Silver also posted its highest gain in a month as
short-term traders bought the metal on gold's coattail, while
platinum group metals were mostly unchanged on concerns that
stagnant growth in Europe could hurt autocatalyst demand.
Gold rebounded from an early session low of $1,210.15 an
ounce on resurgent safe-haven demand, closing in to an all-time
high of $1,248.95 an ounce set on May 14.
"We are seeing gold as the ultimate currency because of all
of these growing uncertainties surrounding sovereign debt in
the euro zone, and the fact that there are very few attractive
currencies out there, said Bill O'Neill, partner at New
Jersey-based commodity firm LOGIC Advisors.
"It's a perfect storm for gold."
Gold was able to rally with light trading volume in U.S.
equity markets and no specific news out of the euro zone,
analysts noted.
German Chancellor Angela Merkel's coalition agreed to
pursue savings of 11.2 billion euros next year, part of a
multi-year package of 80 billion euros to restore investor
confidence. []
Spot gold <XAU=> was at $1,243.55 an ounce at 3:35 p.m. EDT
(1935 GMT), against $1,218.00 late in New York on Friday.
Bullion's 2 percent gain on Monday was its largest percentage
gain in almost a month since May 11.
U.S. gold futures for August delivery <GCQ0> settled up
$23.10, or 1.9 percent, at $1,240.80 on the COMEX division of
the NYMEX.
On hourly charts, the price of gold showed a sharp increase
in the U.S. morning session after the 50- and 200-day moving
averages crossed.
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Graphic on gold's hourly moving averages breakout:
http://link.reuters.com/pam68k
Graphic on SPDR gold holding flows:
http://graphics.thomsonreuters.com/10/GLD_SPDRVL0610.gif
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
In investment news, holdings of the world's largest
gold-backed exchange-traded fund, New York's SPDR Gold Trust
<GLD>, dropped for the first time since April 23. Analysts said
that some investors took profits after a steady increase in
GLD's holdings. []
The euro <EUR=> tumbled to a four-year low versus the
dollar, breaking below $1.19. European shares were down 1
percent by midafternoon. [] []
"It's just a safe-haven play. In euro terms, gold keeps on
making new highs," said Bruce Dunn, vice president of trading
at New Jersey-based Auramet Trading.
Gold denominated in euros <XAUEUR=R> hit a record high of
1,042.28 euros an ounce. Euro gold prices have risen about 35
percent so far this year.
Gold has been lifted by volatility in the wider financial
markets this year, benefiting particularly from fears over euro
zone sovereign debt levels, which have battered the euro.
In other news, long-time technical analyst Robert Prechter
told Reuters that the price of gold could drop 40 percent from
its all-time high because of bearish technical momentum and
deflation due to the European debt crisis. []
GLD HOLDINGS FALL
On Monday, spot silver <XAG=> rose to $18.15 an ounce from
late Friday's level of $17.35.
"From a fundamental perspective, silver's price performance
was detached from its underlying supply and demand dynamics
last year, and instead robust investor interest led the metal
to outperform gold," said Barclays Capital in a weekly note.
Platinum <XPT=> was at $1,507 an ounce against $1,510, and
palladium <XPD=> was at $430 against $423.75, both caught up in
selling of other industrial metals.
Close Change Pct 2009 YTD
Chg Close % Chg
US gold <GCM0> 1239.30 23.1 1.9 1096.20 13.1
US silver <SIN0> 18.162 0.863 5.0 16.845 7.8
US platinum <PLN0> 1517.30 -8.00 -0.5 1471.00 3.1
US palladium <PAM0> 428.85 -0.95 -0.2 408.85 4.9
Prices at 3:33 p.m. EDT (1933 GMT)
Gold <XAU=> 1241.55 23.55 1.9 1096.35 13.2
Silver <XAG=> 18.15 0.80 4.6 16.84 7.8
Platinum <XPT=> 1498.00 -28.50 -1.9 1465.50 2.2
Palladium <XPD=> 430.00 6.250 1.5 405.50 6.0
Gold Fix <XAUFIX=> 1215.00 2.60 0.2 1104 10.1
Silver Fix <XAGFIX=> 17.36 -40.00 -2.3 16.99 2.2
Platinum Fix <XAGFIX=> 1500.00 5.00 0.3 1466 2.3
Palladium Fix<XAGFIX=> 423.00 2.00 0.5 402 5.2
(Additional reporting by Jan Harvey in London; Editing by
Marguerita Choy)
