Will gold market prices be supported by physical buying?
''Physical buying seen cushioning gold's declines
Gold futures edged higher Wednesday as a weaker dollar drew some buying, but gains were muted as investors were reluctant to bet on the metal embarking on another bull run.
The most actively traded contract, for December delivery, was recently up $6.30, or 0.4%, at $1,659.10 a troy ounce on the Comex division of the New York Mercantile Exchange.
Futures in recent weeks have shuffled between $1,600 and $1,700, rising when investors were optimistic about the global economic outlook or Europe's debt crisis, but under pressure as investors remain cautious toward the metal after September's steep plunge.
Gold, sometimes viewed by investors as a safe haven that should rise when the outlook for other assets was grim, has taken cues recently from moves in currencies and commodities, moving along with perceived risky assets.
'Everyone's taking a wait-and-see attitude' toward gold, said Matt Zeman, head of trading with Kingsview Financial. 'The markets are kind of teetering on the day-to-day developments' in Europe.
News from the euro zone was mixed Wednesday, with thousands of protesters marching through the Greek capital to protest new austerity measures set for a vote Thursday. But the euro was higher against the U.S. dollar on hopes that the currency union's bailout fund would receive a substantial boost at a summit of the region's leaders this weekend.
Dollar-denominated gold can rise when the dollar falls, as it makes futures cheaper for buyers using other currencies. The ICE U.S. Dollar Index was recently at 76.761, down from 77.086 late Tuesday in New York.
Analysts say gold has also been supported during its recent pullbacks as physical buyers step in to lock in purchases at bargain prices compared to September's highs above $1,900.''