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COMEX gold up in early trade, churned by data

NEW YORK, Oct 31 (Reuters) - COMEX gold rose Friday morning, nearing the end of a volatile week buffeted by economic data and the dollar's ups and downs, dealers said.

They said gold was calming before the weekend after trying again a day ago to challenge September's 7-year highs, only to have the rug pulled out by Thursday's news that the U.S. economy expanded at its fastest pace in almost 2 decades last quarter, a stunning turn after 3 years of malaise.

December gold at 10:11 a.m. EST (1511 GMT) was up $3.50 at $387.90 an ounce, trading from $382.40 to $388.10 after closing with a $2.60 loss the previous session.

The contract fell from $392 early Thursday, the second failure in a week to challenge the Sept 25 peak of $393.80. It bottomed at $382.50, holding above Wednesday's low of $380.30.

"It looks pretty decent in gold still, as long as it holds above ($380) I think we're OK," a floor broker said. "It broke a technical number $385.50/386.00. If stays above $386, I'm looking for $389."

Gold popped up after morning data showing September consumer spending decreased 0.3 percent, worse than expected, while personal income rose 0.3 percent, a bit better than forecast.

"It's basically because the dollar came off little," said a bullion trader.

Spot gold fetched $385.00/5.80, up from $383.40/4.25 at Thursday's close. London bullion dealers fixed the morning reference price at $384.60 and the afternoon's at $386.25.

The euro was down fractionally at $1.1619/22 in midmorning trade. The weak dollar in recent days lifted the euro toward its lifetime high from May and carried the yen to its highest in 3 years.

Speculators have bet that overseas investors will keep piling into gold as improved buying power in their home currencies offsets the rising dollar price of gold. But some funds are growing impatient for gold to challenge the $400 an ounce level, adding to the volatility.

December silver was up 3.0 cents at $5.165 an ounce, trading from $5.13 to $5.18. Spot silver was quoted at $5.15/17, up from $5.11/13 late Thursday. The fix was $5.135 an ounce.

NYMEX January platinum was off $2 at $755.00 an ounce, digesting its recent runaway gains. Spot platinum was at $750.00/755.00.

December palladium was off $1 at $208.00 an ounce. Spot palladium fetched $205.00/211.00.