Gold bounces off 6-month low, jewellers buy
the metal at $1,600, which if breached could take it down to $1,580.
Hedge funds and some big speculators slashed their bullish bets on U.S. commodities, taking aim particularly at gold which has lost some of its lustre this year, trade data released on Friday showed.
U.S. gold for April delivery was at $1,614.80 an ounce, up $5.30.
In other markets, Japanese shares rallied and the yen fell on Monday after Tokyo escaped direct criticism from its G20 peers on its aggressive reflationary plans that have weakened the currency.
The euro was little changed at $1.3351, having found good support near $1.3310 on Friday. The low also represented the 38.2 percent retracement level of its November-February rally, and a weaker euro makes dollar-priced gold more expensive.
"The technical profile remains bearish. If prices are unable to regain $1,640 the market would target $1,525-$1,550. The RSI is down at 30.1, on the threshold of oversold and it's lowest in a year," said ANZ in a report.
"The current spell of weakness adds to the risks that we may undershoot our Q1 forecast of $1,730, especially if physical buyers hold back on expectations of further falls."
A raft of business surveys this week will be combed over for confirmation of hopes that a dire fourth quarter of 2012 marked the cyclical trough for the world economy.
Major powers plan to offer to ease sanctions barring trade in gold and other precious metals with Iran in return for
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