* Gold falls for first time in seven sessions * But still up more than 3 pct in June, investors nervous
* Specs raise gold, silver longs
June 18 (Reuters) - Gold fell for the first time in seven sessions on Monday as the risk of a Greek exit from the euro zone subsided after parties backing a bailout for the country won an election, denting the metal's safe-haven appeal. The initial vote results drew expressions of relief from the Group of Seven industrialised economies, saying that it was in "all our interests" for Greece to remain in the euro zone while respecting its international bailout commitments.
Despite the loss, gold is still up more than 3 percent so far in June, with investors likely to remain nervous on what awaits the euro zone after the Greek poll, given high borrowing costs in Spain and Italy and the continued threat of the region's debt crisis to the global economy. Gold fell more than 1 percent to a low of $1,606.49 an ounce before bouncing to $1,623.56 by 0043 GMT, down $4.23.
Bullion is more than $200 below a record of around $1,920 struck in September last year. "Well, I think this is temporary. I mean if you look at the chart, there was some big stop loss selling at $1,620. The move is just quick." said Yuichi Ikemizu, head of ommodity trading,Japan, at Standard Bank. "The Greek situation looks ok for now, but I think there's not much reason to sell," said Ikemizu, adding that markets are still worried about other lingering problems in the euro zone. U.S. gold futures for August delivery dropped $3.30 an ounce to $1,624.80 an ounce.
Sunday's election result looked likely to yield a coalition government in Greece led by conservative New Democracy but leaves an emboldened SYRIZA bloc to rally angry opposition in the streets to the punishing terms of the bailout.
The result buys time for the euro zone, which was braced for a SYRIZA victory and the prospect of having to cut debt-ridden Greece loose, potentially unleashing shocks that could break up the single currency. The euro jumped to a one-month high against the U.S. dollar on Monday, but light volumes indicated that dealers were still cautious on how the result would pan out.
Gold which often tracks movements in the euro ignored gains in the single currency, but data from the Commodity Futures Trading Commission (CFTC) indicated investors were still generally bullish on gold.
Money managers raised their net length in gold by 1,258 lots, or around 1 percent, to 99,684 lots in the week to June 12, as signs of a slowing in the U.S. economic recovery and the euro zone debt crisis fueled speculation of monetary stimulus from central banks around the world. Gold gained 2 percent last week, underpinned by hopes of further U.S. monetary easing on signs that the American economy's recovery is on shaky ground. Friday's weak U.S. manufacturing output and consumer sentiment data fed that attitude.
Precious metals prices 0043 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1623.56 -4.23 -0.26 3.82
Spot Silver 28.70 0.03 +0.10 3.65
Spot Platinum 1498.50 22.70 +1.54 7.57
Spot Palladium 633.50 10.30 +1.65 -2.91
COMEX GOLD AUG2 1624.80 -3.30 -0.20 3.70 10418
COMEX SILVER JUL2 28.69 -0.05 -0.17 2.78 1758
COMEX gold and silver contracts show the most active months