Renewed Iranian worries support silver and gold

Even as the last of the U.S.’s troops exit Iraq, a set of fresh developments have fuelled the West’s growing concerns over neighboring Iran’s nuclear and military capabilities. These factors have provided considerable indirect support for Silver and Gold prices in the early trading sessions of 2012 as investor safe haven demand has again increased significantly after relaxing somewhat during late December’s holiday period.

In response to announcements by Iran that it had successfully tested its homemade nuclear power fuel rods, the EU and U.S. each moved to implement substantial economic sanctions against the Middle Eastern nation, resulting in severe domestic currency pressure. Also, Iran has been holding naval maneuvers and has reportedly tested its long range missiles in recent days, which has further increased tensions with the West.

As a result of these Iran related events, both precious metals have started off the first two weeks of 2012 with a notable rally. In particular, spot silver traded off of its December 29th low of $26.15 to trade in a range finding resistance under and around $30 , while spot gold found good support at $1,522.55 on December 29th to move above it’s 200 day moving average in today’s session.

Successful Iran nuclear enrichment fuels western weapons fears
Perhaps the most troubling recent event regarding Iran was the announcement by the Iranian Students’ News Agency that the country has now developed its own nuclear power rod and successfully inserted it into the core of a nuclear research reactor based in Tehran. This report was based on information obtained from Iran’s nuclear power agency.

Although denied by Iran, Western leaders seem increasingly worried that this could indicate Iran has taken an important step forward in developing a nuclear arsenal.

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Posted by Silver Guru on Jan 13 2012. Filed under Silver Analysis. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry