Gold prices swung sharply into positive territory on Thursday as metal’s deep slide on Wednesday-hitting lowest level in last 4 ½ months-resulted in increased physical buying; nevertheless, gains are likely to be limited with euro under pressure due to escalation of Greek political crisis. Silver prices have also risen sharply in trading today.
At last check, U.S. gold futures were gaining 2.18%, trading at $1570.10 an ounce. On Wednesday, the contract had hit the abyss at $1526.70 an ounce at one point of time before bargain hunting helped the metal rebound from year-to-date lows.
Gold– which is traditionally considered as safe haven investment instrument-is moving in tandem with other riskier assets like dollars and equities.
With heightening of euro-zone debt and Greek political crisis, the metal came under heavy sell-off pressure as investors cut short their positions and took profit in order to make up for losses in other riskier assets like euro and crude oil even as many investors sought refuge in the safety of U.S. dollar.
However, some gold metal experts like Afshin Nawabi believe that the current trend might soon change.
While speaking to Reuters, Mr. Nawabi, head at MKS Finance said “Since yesterday we have seen more interest come through from physical buyers…because prices have come down substantially. But there is more upside than downside risk for gold at the moment as the political situation is very jittery with tension in Iran and economic problems especially in the euro zone. People will want to buy physical gold again. Those who went out since December are now waiting for prices to stabilize before getting in again.”
In some other precious metal markets, silver climbed up 2.75%, $27.98 an ounce on Thursday, a sharp rebound after falling for eight successive sessions.
The iShares Silver Trust (ETF) (NYSE: SLV) is currently trading 3.72% higher at $27.35, the ProShares Ultra Silver (ETF) (NYSE: AGQ) is currently trading 7.64% higher at $40.87, and the ProShares UltraShort Silver (ETF) (NYSE: ZSL) is currently trading 7.40% lower at $67.37.
Platinum edged up 1.4 percent at $1,442.70 an ounce, while palladium gained 1.88 percent to $598 an ounce.
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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. |
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.