Spot Gold Prices Edge Higher on Strong Demand from Asia; Silver Prices Fall
Spot gold prices edged higher on Wednesday as jewelers in Asia pounced on the opportunity provided by recent record breaking dips. However, gold futures swung into negative territory as overall sentiment on the metal remains gloomy, which is reflected by constant outflows in gold-backed ETFs. Silver prices, meanwhile, tumbled on Wednesday.
At last check, U.S. gold futures 0.84% to $1375.80 an ounce while spot gold gained 0.37% 1,372.80 an ounce.
According to Reuters, traders said that buying orders in Asia picked up significantly on Wednesday. Renewed interest in physical side buying in Asia raised premiums for gold bars in Singapore to their highest in 18 months at $1.70 an ounce to spot London prices, showed a data provided by Reuters. However, traders added that demand from India, the world’s top importer of gold, remained surprisingly weak in spite of wedding season.
In a note to clients, Nic Brown, an analyst at Natixis said, “(gold) bounced a little bit in the past two sessions and I suspect there was quite a good buying coming out of Asia”
Commenting over at what point investors will start selling gold again and its next trading range, Brow added, “I think that at this point a new range will be established, we can’t go back to the old $1,500-$1,580 range because investor sentiment has fallen, but it still early days to understand at which levels people will feel they can sell again,” according to Reuters.
Meanwhile, analysts at Credit Suisse slashed 3-month outlook on gold to negative, and expects prices of $1,300 in the subsequent 3 months period.
Silver futures tumbled 1.64% to $23.24 an ounce.
In late trading on Wednesday, the iShares Silver Trust (ETF) (NYSE: SLV) was down 0.88% to $22.46, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) was down 1.76% to $24.56.
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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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