Updated from 10:35 a.m. EDT with settlement prices
NEW YORK (
edged up Tuesday as investors mostly sat on the sidelines waiting to see how eurozone leaders plan to handle the details of addressing the region's debt problems.
Gold for December delivery gained 60 cents to settle at $1,771.20 an ounce at the Comex division of the New York Mercantile Exchange. The
traded as high as $1,775.90 and as low as $1,753.20 an ounce, while the spot price was gaining $6.50, according to Kitco's gold index.
"It's just seesawing back and forth based on the last headline," said George Gero, precious metals strategist at RBC Wealth Management. "Everybody's waiting to see, because there was some chatter about Spain and whether the eurozone ministers are getting their act together or not."
for December delivery settled up 35 cents to $34.72 an ounce, while the
U.S. dollar index
was up 0.35% to $79.23.
The yellow metal looked to
reports of mounting worries
that European leaders would not be able to reach an agreement on a banking union, and that if they settled a resolution, it would take years to implement.
Further evidence that gold traders weren't committed to a move in either direction was that the precious metal had not sold off more after crude sharply fell almost $5 a barrel Monday afternoon.
Typically hedge funds and managed-futures funds are either long or short both crude and gold, said Gero. The question is whether these funds, in the event of a crude selloff, should also sell gold because they need the buying power. So, if the euro currency trades down, and crude sells off, then there is a gold dip. In Monday's case, gold didn't appear to follow the sharp drop of crude.
While there may be some upside resistance in the near-term after the recent rocket higher on the back of hefty stimulus plans from both the
European Central Bank
, the long-term prospects for gold look more optimistic, according to David Banister, chief investment strategist at TheMarketTrendForecast.com.
"It might be kind of boring here for a little while [as gold] just kind of slow grinds its way higher," he said. "I think that most people would probably agree that the fundamentals are very good for [precious metals], from the perspective of negative real interest rates ... and increasing inflationary pressure in 2013."