Gold closes lower as oil retreats, dollar steadies

SAN FRANCISCO (MarketWatch) -- Gold futures closed lower Monday as traders locked in recent gains, pressured by a retreat in oil prices to below $75 a barrel and fractional strength in the U.S. dollar against most other major currencies.
Gold for August delivery fell $3.20 to close at $681.50 an ounce on the New York Mercantile Exchange.
There was a "pullback in oil and the dollar was mixed -- thus gold held back from further advances," said Jon Nadler, an analyst at Kitco Bullion Dealers.
"Gold traders are as yet unsure whether profit-taking may be in order first, or whether further tests over $685 could have sufficient fuel from the dollar to allow them to be triggered," he said in e-mailed comments.
On Friday, gold futures gained $6.60 to close at $684.70 and finished $17.40, or 2.6%, higher for the week.
"Gold was up 3% last week primarily on concerns regarding the U.S. dollar, the subprime fallout in the United States and elevated oil prices," said Mark O'Byrne, director at Gold & Silver Investments Ltd., in a research note. He said that the trend from last week is likely to continue in the coming days.
On the currency markets, the dollar traded fractionally higher against most other major currencies Monday. The greenback had hit a fresh record low against the euro and a six-week low against the yen reached during the Asian trading session.
Meanwhile, oil prices dropped back below $75 a barrel as concerns over global supplies eased for now. The decline helped relieve economic worries related to high energy prices.