Gold edged up on Friday, December 8, as investors resorted to bargain hunting after the yellow metal dropped below its recent trading range to hit the lowest in more than four months overnight.
Spot gold was up 0.2 percent at $1,249.04 an ounce, by 0652 GMT, after hitting its lowest since July 26 at $1,243.71 in the previous session.
The metal was down for a third straight week, headed for its biggest weekly decline since early May. U.S. gold futures were 0.2 percent lower at $1,250.80.
“Even as the dollar is firmer, there seems to be a bit of bargain hunting around. I do, however, think that the pressure is on the downside and rallies will still be sold,” a Hong Kong-based trader said.
The dollar inched higher on Friday, as the passage of a bill to temporarily extend U.S. government funding raised investors’ optimism that a tax reform bill would also pass, and eased fears of a government shutdown for now.
“Gold might have found some support in that but it seems to be just the dollar strength across the board now heading into the end of the year,” the trader said.
Markets are eyeing U.S. non-farm payrolls report due later in the day, which will be last employment report before the Federal Reserve meeting next week at which the bank is expected to raise benchmark interest rates.
Higher U.S. interest rates tend to boost the dollar, making greenback-denominated gold more expensive for holders in other currencies.
“The upcoming U.S. data is something which everyone is looking at and completely ignoring the fact that the situation in the Middle East has far larger potential of becoming explosive,” said Naeem Aslam, London-based chief market analyst at Think Markets.
Spot gold may drop more to $1,239 per ounce, according to Reuters technicals analyst Wang Tao. Silver rose 0.4 percent to $15.78 an ounce, but washeaded for a third week of losses.
Platinum climbed 0.5 percent to $896.40 an ounce, but was set to post its biggest weekly fall since March.
Palladium was 0.3 percent higher at $1,016.20.
