LONDON—Spot gold was higher in Europe Friday as the euro held steady against the dollar.
"We expect dull trading to prevail here given the thin macro agenda and quieter geopolitical front," said VTB Capital analyst Andrey Kryuchenkov, adding though that any downside would be limited, particularly with the latest dollar rebound "running out of steam for now."
The price of gold tends to have a strong inverse correlation to the U.S. dollar, as it is the currency in which the metal is priced. Consequently, a weaker dollar makes gold cheaper for other currency holders.
Spot gold was up 0.7% at $1,502.15 a troy ounce and analysts said the market was poised for fresh gains, appearing less crowded after this month's price correction prompted many short-term players to exit.
The market's key support level remains around $1,470 an ounce, while it may hit resistance around $1,520 an ounce, Mr. Kryuchenkov said.
In a note to clients, National Australia Bank said it expected gold to remain around $1,450 in quarterly average terms until the end of the third quarter, after which the price may gradually ease as broader investor concerns abate.
A downside risk to its forecast is the potential for a decline in investor appetite to trigger a substantial increase in gold supply entering the market from highly liquid exchange-traded fund holdings, the bank said.
Spot silver was 0.7% higher at $35.244 an ounce, spot platinum was up 0.2% to $1,764.75 an ounce and spot palladium had increased 0.7% to $729.50 an ounce.
Write to Rhiannon Hoyle at rhiannon.hoyle@dowjones.com
