Gold stays below $1600, silver improves

Gold remained in the pothole it fell overnight in Asian trade Thursday as commodity markets continued to drop ahead of year ending.

Gold for immediate delivery was seen trading at $1574.79 an ounce at 12.00 noon Singapore time while Gold for February delivery was at $1577.04 an ounce on the comex division of Nymex.

Analysts attributed gold’s second-biggest decline since the 2008 economic crisis to technical sell off, year-end fund liquidation and plunging commodities.

Gold option volatility also exploded as futures investors sought to hedge against downside risk.

Gold has slid 18 per cent since hitting $1920 an ounce in September, a drop that takes it closer to bear market territory and might signal a peak in bullion’s decade-long rally.

Meanwhile spot silver gained 0.6 percent to $29.04 in early trade, off the 2-1/2-month low of $28.48 hit on Wednesday.

The metal posted adecline of nearly 6 percent in the previous session, its sharpest since the end of September.

Trading volume was almost 50 per cent above its 30-day moving average, on track to be one of the busiest sessions in the last three months.

On Wednesday, gold for February delivery settled down $76.20 at $1586.90 an ounce on the Comex division of the New York Mercantile Exchange.

A commodity market maelstrom also prompted investors to sell gold to cover losses elsewhere, as U.S. crude oil futures sank about 6 per cent and copper dived 5 per cent. – Bullion Street

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Posted by Silver Guru on Dec 15 2011. Filed under Silver prices. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry