The spot price of gold as well as the prices of platinum group metals, platinum, palladium and rhodium, traded to long-term or all-time highs on fund buying and bullish sentiment towards precious metals, traders and analysts said.

At 5pm, gold was quoted at $572.75/oz, up $3.40/oz from the previous close. In January 1981 gold fixed at $602.25/oz.

"The momentum higher in gold continues. The consensus in the market is that gold will trade to between $600/oz and $800/oz in 2006. The asset relocation into gold continues," said Switzerland-based MKS Finance's Frederic Panizzutti.

There were two key factors driving gold, which was its insurance value against uncertain and unexpected events as well as an increasing role as an investment asset, he added.

For the foreseeable future gold could target $580/oz, followed by $600/oz, with support at $550/oz, Panizzutti said.

"The precious metals complex continues to trade in recent high ranges with positive sentiment in the complex intact, with inflationary concerns stoked by high oil prices providing support to the complex.

Iran in the spotlight

"The current geopolitical situation also remains tense, another factor supporting gold prices, with the International Atomic Energy Agency (IAEA) holding an emergency meeting today over reporting Iran to the United Nations Security Council," London-based Barclays Capital analysts wrote.

"The firm start in the US might be the catalyst needed for a test of $575/oz, particularly with the IAEA due to reach its verdict on Iran which could mean sanctions and would not only heighten tension in the Middle East, but could create inflation concerns if oil output was curbed," UK-based TheBullionDesk.com analyst James Moore wrote.

"We believe the strength of the physical market is vitally important for 2006; even though gold is rising on speculative and investment buying, at some point there will be a reversal of this trend and gold will correct," London-based UBS analyst John Reade wrote.

"The level at which physical demand emerges to support the metal will then form a base for gold to make fresh gains," Reade added.

Platinum

At 5pm, platinum was quoted at $1080.50/oz, up $7.50/oz from its previous close. Earlier on Wednesday, platinum reached an all-time high of $1082.50/oz.

"Platinum looks set to test $1100/oz while a break above $298/oz would leave the way clear for palladium to test of $330/oz," Moore wrote.

Palladium — which is largely used in autocatalysts — was quoted at $300.50/oz, up $6/oz from its previous close. Earlier on Thursday, palladium traded to its highest level since April 2004.

Palladium, which is trading 70 percent below its 2001 peak stands out as a laggard in the precious metals complex, Reade wrote.

"Investor sentiment will determine where palladium trades in 2006 but from a fundamental perspective we much prefer platinum to palladium," he added.

Rhodium was last quoted at $3500/oz, up from its previous close of $3400/oz, and the highest level since July 1991.