NEW YORK, Oct 28 (Reuters) - COMEX gold prices ended higher on Monday, boosted by early technical buying and then weakness in the dollar.
Fund and trade buying that began last week after gold hit its medium-term range low continued, brokers said.
Later in the session, dollar weakness helped prop up gold, since dollar-denominated gold becomes cheaper for overseas buyers when the U.S. currency loses value.
Foreign exchange dealers sold off dollars on expectations of weak U.S. economic data later this week.
Some analysts also said that recent selling had probably been overdone and needed to be corrected by Monday.
December gold closed $1.70 higher at $315.60 an ounce.
With both technical and fundamental factors supporting higher gold prices, traders saw further gains on Tuesday.
COMEX estimated final gold volume for Monday's session at a somewhat modest 26,000 lots, less than Friday's final count of 30,782 contracts.
Frank Aburto, broker at F.C. Stone, said some funds held their long gold positions in the recent price drop to $309.10. He said he thought some long positions were taken out around $308.50 on December gold.
He said, on Monday, "the level of the (gold) market attracted some new buying. I would have expected the rebound to have happened below $309, but I guess there were some people anxious to get back in the market sooner than that."
Last Friday's Commitment of Traders report showed non-commercial traders had lowered their net long gold positions to 9,462 contracts, down sharply from 15,914 contracts in the prior week. That was down from Oct. 1's net long holdings of more than 42,000 lots.
One technical analyst said he sees upside Fibonacci retracement levels at $316.80, $319.20, and at $321.60 an ounce as possible upside targets for December gold prices.
Aburto said he saw December gold still contained by its latest range between $310 and $320 an ounce.
Spot gold was quoted at $315.0/5.50, putting further distance between Friday's close at $313.60/4.10. London dealers fixed Monday's late spot reference price at $314.45 an ounce.
December silver moved up with gold, but edged off the highs to settle up 0.50 cent at $4.412, It set a $4.40-$4.435 range. Spot silver was quoted even with Friday's late price of $4.40/42. Silver was fixed in London at $4.42.
NYMEX January platinum finished even at $586.50 an ounce. Spot platinum was quoted $588/592 an ounce.
December palladium rose $2.60 to $314.0, climbing up from Thursday's contract low at $309 an ounce. Spot palladium fetched $308/314 an ounce late Monday.