Gold and Silver Prices Rebound after Wednesday’s Sell Off
Gold and silver prices have rebounded in trading today following Wednesday’s huge sell-off. On Wednesday, gold posted its biggest one-day drop in more than three years.
At last check, spot gold was trading 0.44% higher at $1,702.76 an ounce. Gold futures for delivery in April on the Comex division of the New York Mercantile are trading 0.02% higher at $1,711.60 an ounce.
Spot gold prices plunged more than 5% on Wednesday after the Federal Reserve Chairman Ben Bernanke did not signal at additional quantitative easing during a speech. Hopes of additional quantitative easing, which would have pushed the dollar lower, had boosted gold prices in recent weeks.
Walter de Wet, Standard Bank analyst, told Reuters that he had a sense that the gold market was increasingly pricing in quantitative easing 3 and obviously Bernanke has put a dampener on that. He added that there have been physical flows coming off steadily since the beginning of February and the physical demand is just not there when gold is at $1,750-$1,800 an ounce.
Meanwhile, UBS said in a research note that a large part of why gold conceded so much came down to three other factors-$1,800 was proving to be too much of a hurdle and a certain staleness had entered the market, positioned had increased very swiftly in recent weeks, and physical demand has been non-existent.
Silver prices have also bounced back after Wednesday’s drop. At last check, spot silver was trading 0.4% higher at $34.73 an ounce.
In pre-market trading in New York, the iShares Silver Trust (ETF) (NYSE: SLV) is currently up 0.89% to $33.82, the ProShares Ultra Silver (ETF) (NYSE: AGQ) is up 1.57% to $63.84, and the ProShares UltraShort Silver (ETF) (NYSE: ZSL) is down 1.38% to $9.28.
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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. |