Gold Prices Continue to Climb, Silver Prices Rise More Than 2%
Gold prices extended gains during Asian trading hours on Wednesday as physical-side demand from Asia continued to remain strong, pushing prices close to $1,450 an ounce level. More gains are expected, if the metal breaks above $1,447-$1450 range as it will induce technical buying, believe gold’s strategists. Meanwhile, silver prices rose more than 2% in early trading on Wednesday.
Gold prices also found some support over the news that global central banks increased their bullion holdings in March.
At last check, U.S. gold futures for June delivery climbed 1.64% to $1,447 an ounce while spot gold gained 1.1% to $1,446.61 an ounce. Silver futures leaped 2.15% to $23.33 an ounce.
However, overall investors’ sentiment in gold still remains slackened following last week’s massive sell-off, which saw prices dropping to as low as $1,321 an ounce.
A data provided by Reuters showed that holdings of the SPDR Gold Trust (ETF) (NYSE: GLD), which is the world’s largest gold-backed ETF, contracted by another 0.38 percent to 1,092.98 tons on Wednesday — its lowest level since late 2009.
On Wednesday, the International Monetary Fund said that central banks from Russia and Turkey increased their gold reserves in March, which was before unprecedented plunge in prices. Still, it could instill some faith on the metal. The Cypriot government’s decision to liquidate bullion holdings to cover a part of its funding requirements triggered concerns that other heavily indebted nations could also follow the suit.
Meanwhile, physical side from Asia continued to remain robust with premiums on gold bars, coins rising to multi-month high.
Commenting over the rebound in gold prices and possibility of more gains, Joyce Liu, an investment analyst at Phillip Futures in Singapore, said, “If the price breaks above $1,447-$1,450 levels, there will be more upward momentum…If it doesn’t, we may see a further dip in gold prices,” according to Reuters.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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