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Gold, silver close at multi-decade highs

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  • Gold, silver close at multi-decade highs

    Gold, silver close at multi-decade highs

    By Myra P. Saefong, MarketWatch
    Last Update: 2:26 PM ET Mar 30, 2006

    SAN FRANCISCO (MarketWatch) -- Gold and silver futures closed Thursday at levels the market hasn't seen since the early 1980s and copper set a record, as dollar weakness reignited the rally in commodities.
    Gold's move "is a continuation of strong global demand aided by a glut of U.S. dollars in the world looking for a diversified asset class this is not deemed overvalued and provides the safety in an uncertain marketplace," said Peter Spina, an analyst at GoldSeek.com.
    "Gold is clearly headed for $600, possibly even higher during the next several trading sessions," he said. "One should watch out for this market to quickly overheat, but more gains are likely first."
    Gold for June delivery traded as high as $592.10 an ounce on the New York Mercantile Exchange before closing up $13.20, or 2.3%, at $591.80. It marked its highest close since January 1981.
    The dollar was last trading down 0.3% against the yen, and the euro was up 1% vs. the greenback as traders re-evaluated the Federal Reserve's statement following its policy meeting on Tuesday, at which it hiked rates and promised more increases to come. See Currencies.
    "Anyone still not yet on board the secular bull market in precious metals are being left in the dust," said Peter Grandich, editor of the Grandich Letter.
    "A coming crisis in the U.S. dollar will only add more steam to the engine," he said.
    Gold also found support in safe-haven buying after Iran rejected a United Nations Security Council call to cease uranium enrichment, sending energy prices higher. Ministers representing five western governments will meet today in Berlin to discuss the next steps to be taken against Iran and its nuclear program. See Futures Movers.

    Silver at new heights
    Against this backdrop, silver for May delivery rose as high as $11.715 an ounce, its highest level since late 1983, before closing up 54.5 cents, or 4.9%, at $11.66 an ounce.
    Silver has shot higher in the past several sessions amid excitement about an exchange-traded fund from Barclays that's expected to launch shortly.
    The ETF will be backed up by physical supplies of silver, just as gold ETFS are backed up by bullion held in a vault. See related story.
    "Investor interest is obviously quite strong, as both supply and potential demand numbers are factored in and warehouse stocks leave very little, if any, silver once the Barclays exchange product comes to market," said Jon Nadler, an investment products analyst at bullion dealers Kitco.com.
    But Dale Doelling, chief market technician at Trends In Commodities said he "expects a setback in silver after the ETF is launched."

    Copper at all-time high
    May copper also added 4.6 cents, or 1.9%, to close at $2.4845 a pound, having earlier traded at a record $2.494 a pound.
    "With the copper markets and some of the base metals seeing a positive flow of buying interest lately and the U.S. stock market hinting at even better economic conditions ahead, the overall environment for metals is supportive," said Nell Sloane, an analyst at NSFutures.com, in daily commentary.
    And "seeing the copper market rise sharply into new high ground this week, means that silver is getting support from both gold and copper or in other words from the precious and industrial metals aspect," she said.
    Copper got an added boost after Morgan Stanley increased its copper price forecast, predicting it will stay above $2 a pound until 2008.
    "We could see the spot price move to the $2.60-2.80/lb range on a short-term basis," said analyst Wayne Atwell.

    Elsewhere, July platinum rose $14.80 to finish at $1,102.70 an ounce. The contract's high of $1,104.80, was a new record for a front month contract. It was also nearing the price record for any contract month, which was set at $1,189.50 on March 5, 1980, according to NYMEX data.

    June palladium closed up $12.90 at $350.30 an ounce following a rise to $355.80, a level not seen since late 2002.
    Economists at Action Economics said the strong gains in base metals of the past several sessions had sparked a surge in demand from fund managers looking for asset classes offering higher returns.

    SAN FRANCISCO (MarketWatch) -- Copper futures set an all-time high on Thursday, while gold and silver prices closed at levels not seen since the early 1980s,...
    "There's one way to find out if a man is honest-ask him. If he says 'yes,' you know he is a crook." Groucho Marx

  • #2
    yep i am long both Silver and Gold and have been for the last two months, really saying some payback this week, yay and a big booo for the kiwi dollar be short that for the medium term its sliding
    Last edited by duvetray; 31-03-2006, 10:57 PM.
    Kia kaha