Gold prices up on technical trading

Gold futures on the COMEX division of the New York Mercantile Exchange rose on Wednesday as gold became oversold.

The most active gold contract for April delivery rose 1.7 U.S. dollars, or 0.09 percent, to close at 1,835.1 dollars per ounce.

Investors are correcting their positions by buying gold after two trading sessions of wild swings, in reaction to an initial rush into gold as a safe haven in response to volatility in the silver market, then the subsequent reaction by CME to require additional margins to decrease the impact of the volatility in the silver market, which diminished safe haven demand for gold and led to it becoming oversold.

Nevertheless, upbeat economic figures released on Wednesday capped gold's growth. The Automated Data Processing Inc. reported that U.S. private payrolls rose by 174,000 in January after shedding a revised 78,000 in December.

The seasonally adjusted final IHS Markit U.S. Services PMI Business Activity Index registered at 58.3 in January, up from 54.8 in December and higher than the earlier released flash estimate of 57.5.

The Institute for Supply Management reported its services PMI at a two-year high reading of 58.7 percent in January, one percentage point higher than the seasonally adjusted reading of 57.7 in December.

Silver for March delivery rose 48.7 cents, or 1.84 percent, to close at 26.889 dollars per ounce. Platinum for April delivery rose 18.5 dollars, or 1.69 percent, to close at 1,114.5 dollars per ounce.