* Gold picks up, euro correlation erodes
* $1,800 remains focal point for markets
* Gold/silver ratio eases
By Amanda Cooper
LONDON, Oct 11 (Reuters) - Gold rose on Thursday following four straight days of declines after the euro shrugged off a downgrade of Spain's creditworthiness.
Ratings agency Standard & Poor's cut Spain's credit rating to one notch above junk because of its concerns the country's recession was limiting the government's policy options.
Gold had made no gains so far in October, having risen by nearly 5 percent in September after the U.S. Federal Reserve said it would buy bonds to prop up the economy for as long as job creation remained sluggish.
The dollar gained against the low-yielding yen but fell against the euro after data showed the number of new U.S. claims for unemployment benefit fell in the last week to its lowest in more than 4-1/2 years, suggesting the economy may be generating more jobs.
But analysts warned that seasonal factors may have accounted for the decline.
Spot gold rose 0.5 percent on the day to $1,770.89 an ounce by 1412 GMT. The price fell by more than 2 percent over the prior four trading days, its longest stretch of declines since June this year.
Gold priced in euros rose for a fourth day in a row to within 1 percent of the record high of 1,386.38 euros an ounce struck on Oct. 1.
"(Gold) is going to take its biggest cue, as it has for the most recent past, from what happens in the U.S. in respect to the strength of the economic recovery and what that means for monetary policy," Credit Suisse analyst Tom Kendall said.
"The problem with the weekly initial jobless claims is you can get big effects due to seasonality ... and I suspect that this week's release contains some of those kinds of factors and the fact that gold hasn't reacted suggests that this is the consensus out there."
Gold has risen by 13 percent or about $215 in 2012 so far, making it one of the best-performing commodities this year, with $165 in gains in the last two months alone, after the U.S. Federal Reserve indicated, then outlined, its intention to resume buying bonds to prop up the economy.
SEEKING BREAKS
The failure of the gold price to pierce $1,800 an ounce since then has led to a modest downward correction.
"The path of least resistance for gold appears to be lower, we believe. Institutional investors give the impression of losing enthusiasm for another challenge of gold's USD1,790-1,800/oz price levels," HSBC analyst James Steel said.
"Near term, traders might want a reduction in long net speculative positions from current high levels before they recommit to gold," he said.
Steel added he believed the underlying bullish case for gold remained intact, given the prospect of loose monetary policy for years to come, ongoing central bank purchases of bullion and demand from key consumers such as China.
In other precious metals, silver rose 0.6 percent to $34.17 an ounce.
So far in 2012, silver has been the top performing precious metal, with a gain of nearly 24 percent, compared with a 20 percent rise in runner-up platinum, a 13 percent rally in gold and a 0.3 percent loss in palladium.
Platinum rose 0.9 percent to $1,682.99 an ounce.
The price of platinum has risen by 20 percent in the space of two months after a spate of strikes in South Africa shuttered much of the country's production capacity and left nearly 50 dead after clashes between miners and police turned violent.
Nearly 80 percent of the world's platinum comes from South Africa.
A Reuters poll on Wednesday shows analysts are less optimistic about the price prospects for platinum this year and next, even with the constraints on supply.
The fragility of demand from the car industry, particularly in Europe, poses enough of a threat to the market balance that analysts now expect a median platinum price of $1,559.50 in 2012, compared with forecasts three months ago for an average price of $1,572, according to the survey. [PRE C/POLL]
Palladium was up 0.4 percent at $648.50 an ounce. (Editing by Robin Pomeroy and David Cowell)
