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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: long-gone who wrote (12500)	6/3/1998 6:11:00 PM
From: goldsnow	Read Replies (3) \| Respond to of 116795

''I think overall the market is pretty bearish on gold but I think it's bottoming and forming a mid-term base here,'' he said. ''As long as it doesn't fall below $285, I think it can go higher,'' he said. Golds rally stalls with the end of producer buying 11:38 a.m. Jun 03, 1998 Eastern LONDON, June 3 (Reuters) - Gold's rally to $294.00 faded on Wednesday afternoon as the market took the end of purchases by a single producer as the signal to start a gentle sell off, dealers said. Gold fixed at $292.40 an ounce in the afternoon, down on the morning's $293.35, having spent much of the day range trading between $291.00 and $293.00. ''There's been an 800,000 ounce purchase, which we believe to have been a buy back,'' said one London dealer in reference to widespread market talk of a single gold producer having closed off a least a part of its price hedging operation by buying back physical metal. ''We have heard figures of anything between 400,000 and two million ounces. As soon as it finished, then down we went again,'' he said. While uncertainty remained as to the scale of the buy-back and the identity of the mine, the logic of the situation pointed to a North American producer having been involved rather than an Australian or South African operation. Gold prices in Australian dollars and rand, while off their recent peaks at A$485 and 1591 rand respectively, remained at levels suggesting further forward sales rather than buy backs. Even then, such tactics were risky given the current mood in bullion, the dealer said. ''I think it's very dangerous to play at doing buy backs in this climate. You are a hero if the market goes up but if it goes down, you are just a goat,'' he said. One Swiss dealer said that despite gold's recent losses, it was managing to build a floor beneath the current price. ''I think overall the market is pretty bearish on gold but I think it's bottoming and forming a mid-term base here,'' he said. ''As long as it doesn't fall below $285, I think it can go higher,'' he said. Technically, gold had behaved very much as the chartists had predicted, running into stiff resistance near $295 and slackening off to support at $290.50. It was last at $290.70/$291.20, 20 cents below its previous New York close. Silver remained somewhat of a puzzle, at times following gold and at others striking out on its own, a sign that large operators were at play, said one of the dealers. ''Silver is so oversold it's just not funny - but it can't seem to bounce from here,'' he said, adding that sustained interest remained evident on the part of several funds and large private investors. ''Silver looks better than gold,'' said the Swiss dealer. ''If we see the market above $5.22/23, we might see $5.40 relatively quickly,'' he said. Silver was last just softer at $5.15/$5.18 versus its previous New York close of $5.18/$5.21. Palladium continued its recent sharp decline, fixing nearly 40 percent down on its May 18 peak of $417.00 an ounce as rumours of Russian deliveries of sponge metal abounded, dealers said. It fixed at $258.00 an ounce on Wednesday afternoon versus Tuesday afternoon's $273.00, its lowest since March 11 but still up on the year's opening level near $200. Russia has failed to export any metal officially so far this year, dogged as it is by continuing political, financial and bureaucratic problems and wrangles. There have however being growing reports of Russian sponge metal being offered to the market, which dealers said was the reason for price falls. Russia shipped 4.8 million ounces in 1997 according to leading refiner Johnson Matthey, while South Africa shipped 1,810,000 and North America 545,000 ounces. Palladium was last softer again at $247.00/$257.00 versus $254.00/$264.00 at its previous close in New York while platinum was also weaker at $354.00/$356.00, down $10.00. ((Patrick Chalmers, London Newsroom +44 171 542 8057. london.commodities.desk+reuters.com))