12/07/98 - MIDSESSION N.Y. METALS: DEALER BUYING, STOPS SEND GOLD HIGHER
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New York-Dec. 7-FWN--GOLD FUTURES HAVE SURGED SHARPLY higher here this morning, with market watchers commenting that some buying has occurred in the physical market and stops were hit in the futures.
Silver is also firmer, getting help from the gold futures.
Platinum and palladium, meanwhile, are slightly mixed in markets that have seen more Russian sales of palladium but are worried about whether they will continue after Jan. 1.
"We've had a run in gold," said William O'Neill, director of futures research with Merrill Lynch. "We've had a lot of bank dealer buying coming in.
"It looks like somebody came into the physical market and took some metal off. When you have not just one, but a number of dealers coming in at one time, it usually indicates there was some physical offtake.
"It looks like a large fund may have come in to do some buying and took some metal from the dealers, so we're seeing some good bank dealer hedge buying."
Stop-losses were triggered as the gold futures moved through their recent highs, he continued.
Said a floor trader: "It's strictly stop-loss buying coming into the market. All the dealers came in buying and triggered stops."
After initially trading fractionally lower, the February futures have firmed to as much as $299.50, which represented a gain of $5.20 from Friday's close.
March silver has also been firmer, trading up to $4.85.
"It's just being dragged along by the general strength in the gold," said O'Neill.
Meanwhile, a platinum/palladium dealer said there are reports of some Russian selling of palladium today on the London fixes.
"But there was not too much," he continued. "Otherwise, everything is dead quiet."
Despite the reported Russian sales, these metals are slightly mixed, with platinum slightly firmer and palladium marginally softer.
The anticipation is continuing to build ahead of the end of the year, with traders expecting another delay in Russian shipments, sources said. One noted this is probably why prices have not fallen more than they did today due to the Russian sales.
"Anything the Russians have been bringing out to market off the fixes has been gobbled up," he said. "I think people are sort of stockpiling in anticipation."
Support for February gold is seen at $294, with resistance at $300, said O'Neill. Support for March silver is seen at $4.68, with resistance at $4.90. Support for January platinum is pegged at $346, with resistance at $354. |
