June 29, 2018 / 10:12 AM / 5 months ago

PRECIOUS-Gold up from 6-month lows on bargain hunting, weaker dollar

    * Spot gold on track for third weekly fall
    * Gold down more than 5 pct this quarter
    * Platinum headed for 8 pct quarterly decline

 (New throughout, updates prices, market activity and comments,
adds second byline, NEW YORK  dateline)
    By Renita D. Young and Eric Onstad
    NEW YORK/LONDON, June 29 (Reuters) - Gold prices rose on
Friday from six-month lows as a weaker U.S. dollar prompted
bargain hunting, but bullion was on track for weekly and monthly
declines and analysts said many speculators maintained short
positions, leaving prices vulnerable to further losses.
    Spot gold        added 0.4 percent at $1,252.81 an ounce by
1:34 p.m. EDT (1734 GMT). On Thursday, it touched $1,245.32, its
lowest since Dec. 13, 2017.    
    U.S. gold futures         for August delivery settled up
$3.50, or 0.3 percent, at $1,254.50 per ounce. 
    "Gold is finding support from the weak U.S. dollar and firm
euro...and is at least recouping the losses it incurred
yesterday," Commerzbank said in a note.
    Despite Friday's gains, gold was down 1.2 percent so far
this week, headed for a third straight weekly decline. For the
month, spot gold was down about 3.4 percent, on track for its
biggest monthly drop since November 2016.
    "At the end of the month and end of the quarter, people try
to buy gold to boost it," added Michael Matousek, head trader at
U.S. Global Investors.
    Both spot gold and platinum prices were headed for their
weakest quarters since year-end 2016.
    "The shorts are still in control and the momentum is
negative. The dollar and U.S. Treasuries have taken over the
role of safe haven this month and as long as the trade war is
creating uncertainty then that will probably prevail," said Ole
Hansen, head of commodity strategy at Saxo Bank in Copenhagen.
    Hansen said the downtrend would likely accelerate unless
gold held above multiple support layers slightly below $1,240. 
    The euro        increased after European Union leaders
reached an agreement on migration.       
    A stronger euro potentially boosts gold demand by making
dollar-priced bullion cheaper for European investors.
    The dollar index slipped against a basket of currencies.
      
    Meanwhile, spot silver        gained 1.1 percent at $16.13
an ounce. It was heading for a 1.9 percent weekly drop and 1.4
percent monthly decline.
    Palladium        rose 0.7 percent at $951.45 an ounce. It
was down 3.4 percent for the month, its weakest month since
March.
    Platinum        added 0.2 percent at $849.24 per ounce.
During the session it hit its lowest since January 2016 at
$837.30. It was down 8 percent for the quarter and 5.8 percent
for the month.
    "Speculative financial investors are currently betting on
falling platinum prices to a greater extent than ever before,
and platinum ETFs have been seeing continual outflows for
months," Commerzbank said in a note.

 (Additional reporting by Karen Rodrigues in Bengaluru; editing
by David Gregorio and Louise Heavens)
  
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