NY Precious Metals Review: Gold skids in technical move
By Ross Allen, Bridge News
Washington--Jun 27--COMEX Aug gold settled down $3.90 at $335.90 per ounce after fund and commission-house selling pushed it to a contract-low $335.20 in late trade. The institutional sales
sent gold through key support at $337 in midday trade and the metal continued edging lower throughout the session. * * *
Strength in the Dow and fading worries about inflation also helped gold to falter. Gold is often seen as a hedge against inflation; however, there is little fear of this at the moment among investors.
Other precious metals settled lower on the selloff in gold. COMEX Sep silver settled down 6.5 cents at $4.725 per oz. NYMEX Oct platinum settled down 50c at $406.50 per oz and Sep palladium settled down $5.20 at $176.20 per oz, both falling on the gold selloff as well as bearish expectations there would soon be shipments from Russia to its platinum and palladium consumers.
The commission-house sales of gold added to market bearishness brought on by producer forward-selling reported Thursday. These sales helped put a cap on NYMEX prices at $340.00 as producers doubt the likelihood of a nearby rally to sell into.
Panicky selling by producers also reinforced gold's slide on commission house sales, traders said. Producer selling, which was seen Thursday, also contributed as both pushed the market lower and capped upside potential at $340.00,traders said.
Holding support at $337-336.50 was a key to a making a near-term rally possible, traders said. Having failed to hold support, the metal looks set for additional losses in Monday trade.
"The best thing for this market would be to get it down, get it to where demand is going come back in," one trader said. "I don't care if it's $300, $290, $270--or $330--get to somewhere people can feel good about buying again."
The metal was continued to be pressured by an extremely bearish report by Merrill Lynch analyst Ted Arnold, who argued gold will have occasional short-covering rallies within a general downtrend.
This report, which said gold would sell for $250 per oz before it saw $450 again, was a major background factor in the sales, traders said.
SETTLEMENT PRICES
Aug gold (GCQ7) at $335.90, dn $3.90; RANGE: 340.10-335.20
Sep silver (SIU7) at $4.725, dn 6.50c; RANGE: 4.795-4.720
Oct platinum (PLV7) at $406.50, dn 50c; RANGE: 412.00-406.00
Sep palladium (PAU7) at $176.20, dn $5.20; RANGE: 181.00-176.00
SPOT PRECIOUS METALS PRICES: Late New York London Late Tokyo Gold (KRCGL)
334.60-335.10 337.40-337.90 337.50-338.00 Silver (KRCSL) 4.72-4.74 4.75-4.76 4.75-4.77
Platinum (KRCPL) 411.50-412.50 419.00-423.00 416.00-421.00 Palladium (KRCPA)
191.00-196.00 194.00-198.00 193.00-198.00 |
