Gold rebounds as dollar plunges against European single currency

On Wednesday spot gold rebounded as the dollar lost its ground against euro. According to the market reports volumes were relatively low as market participants expected gold to remain range-bound ahead of U.S. jobs data Thursday.

At 0925 GMT, spot gold was trading at $932.25 a troy ounce, up 0.7% on the day. Spot silver was 0.9% higher at $13.692/oz. 

Spot platinum gained 0.3% to $1,175.50/oz, and spot palladium was flat at $248/oz. 

According to traders gold remains linked to the movements of the US currency and is firmly fixed in a range between $920-$940/oz. 

Walter de Wet, an analyst at Standard Bank, notes that while any movements towards $930/oz have brought out physical buying, rallies towards $940/oz are choking off that demand.

"Generally, we feel the upside is fairly limited for gold. Above $940, we're not seeing much buying, especially from the physical side." 

Demand for gold exchange-traded funds remains relatively weak. Holdings in the SPDR Gold Shares ETF fell over five metric tons Tuesday to 1,2120.55 tons. 

Westgate said gold and the other precious metals will likely stay range-bound until the U.S. June non-farm payrolls figures. 

Trading volumes and price action may pick up Thursday as market participants square their positions ahead of the long weekend in the U.S., said a London-based trader.