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Gold surged 2.5 percent on Thursday, its biggest daily rise since June, as physical buyers kept scooping up the metal at prices viewed as a bargain after bullion hit a two-year low on April 15.
Silver rallied 5 percent during the session, and platinum group metals gained 2 percent.
Bullion has now retraced about half of its losses after it fell a combined $225 US an ounce over two days in April.
"It was due for a bounce after that devastating move earlier in the month," said Sean McGillivray, head of asset allocation at Great Pacific Wealth Management.
Buying continued the day after billionaire investor John Paulson said he would maintain his bullish view on gold. Sentiment also got a boost late on Wednesday, when data showed Russia's central bank and others bought gold in March.
Buyers were also encouraged by rising premiums in Asian physical gold and the U.S. Mint's suspension of sales of smaller American Eagle gold coins after soaring demand depleted inventory.
McGillivray said gold is likely to hit technical resistance at $1,500 an ounce, as people who bought at sharply lower levels take profits.
During the session, spot gold hit a 10-day high of $1,468.60 an ounce. It was at $1,465.75 an ounce by 2:55 p.m. EDT, up 2.4 percent for the session and around 11 percent above a two-year low of $1,321.35 hit last week.
U.S. gold for June delivery settled up $38.30 at $1,462 an ounce, with trading volume on track to finish around 20 percent below its 30-day average, preliminary Reuters data showed.
Silver rose 5.1 percent to $24.27 an ounce.
Traders cited gold and silver buying related to the expiration of Comex May options after markets close on Thursday.
Trading was active for both buy and put options around the heavily positioned $1,450 strike price as gold market participants looked to profit after the rout that sent gold to a two-year low last week, said Frank McGhee, head precious metals trader at Integrated Brokerage Services LLC.
In addition, rising premiums in Asian physical gold and strong sales at U.S. coin dealers suggested bargain hunters have stepped up following the gold market's swoon.
"There has been a massive surge in terms of physical interest in Asia - we had a record level of shipments to India last week, which was twice the level of the previous week," Standard Chartered analyst Daniel Smith said.
Crude oil prices also rallied for the second day, keyed by geopolitical tension after the United States said on Thursday it believed that Syria's government has likely used chemical weapons on a small scale also supported gold.
ETFs SELL, CENTRAL BANKS BUY
Daily outflows from exchange-traded funds showed no sign of abating, suggesting that sagging investor confidence is unlikely to be restored any time soon after last week's sell-off.
Holdings of the world's largest gold-backed ETF, SPDR Gold Trust, dropped a further 0.4 percent on Wednesday from Tuesday to their lowest since late 2009.
Russia and Turkey raised their gold reserves in March, the International Monetary Fund (IMF) said on Wednesday, which was ahead of the spectacular plunge in prices this month that shocked ardent gold investors and bulls.
Gold came under pressure earlier this month after the ECB and IMF asked Cyprus to sell reserves to raise 400 million euros as part of a bailout deal, raising speculation other indebted euro zone countries could follow suit.
Among platinum group metals, platinum gained 2.8 percent at $1,465.50 an ounce and palladium was up 2 percent to $678.75 an ounce.