Gold and Silver Prices Gain in Early Trading
Gold and silver prices are gaining in early trading today as the euro hit a two-week high against the U.S. dollar following successful Spanish and French bond auctions.
At last check, spot gold was trading 0.2% higher at $1,661.99 an ounce. Earlier in the day, spot gold prices rose to $1,669.75 an ounce, the highest level since December 13.
Gold has made a strong start to the year, climbing more than 6%. Gold broke away ranks with the euro in the first two weeks of 2012. However, the precious metal has tracked the single currency this week, which strengthened following some positive developments in the euro zone.
Pradeep Unni, Senior Analyst at Richcomm Global Services, told Reuters that rising risk appetite, a weak U.S. dollar and the breach of key resistance is giving gold the momentum to head towards the $1,700 an ounce level in the near term. Unni said that further resistance could be expected at $1,686 an ounce.
Investors’ risk appetite has also been boosted by news that the International Monetary Fund (IMF) is looking to more than double its lending resources by raising $600 billion. The additional firepower will help IMF in dealing with the debt crisis in the euro zone.
In a research note, Commerzbank today said that gold could receive additional buoyancy if the market responds positively to today’s auctions of Spanish government bonds. Commerzbank also said that on the other hand, negotiations over the Greek haircut are clearly on a knife-edge.
Meanwhile, UBS said in a research note that gold’s ability to rise even without the prospect of continuing strong physical demand boded well for the precious metal.
Silver prices are also higher in early trading. At last check, spot silver was trading 0.6% higher at $30.66 an ounce.
In early trading in New York, the iShares Silver Trust (ETF) (NYSE: SLV) is down 0.13% to $29.61, the ProShares Ultra Silver (ETF) (NYSE: AGQ) is down 0.14% to $50.13, and the ProShares UltraShort Silver (ETF) (NYSE: ZSL) is flat at $12.87.
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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. |