London Gold Fixes Easier, Silver Steadies

Gold and silver prices were steady at lower levels on Thursday morning following fund-led selling in New York late in the previous session.

Its a silver story this morning, one dealer said, adding that there had been little action in gold since the start of trading in Europe. Gold was fixed at $349.10 per ounce against $351.05 on Wednesday afternoon when it closed at $351.10/$351.60.

The Comex June futures contract had closed down $2.60 at $352.10 after it came under pressure from several factors including the pressure on silver.

A slump in crude oil futures as the winter heating season ended with high crude stocks in the US and weakening stock market values put pressure on gold, market analysts said. Silver futures fell 13.50 cents on the Comex May delivery contract to a seven-week low of $4.87 per ounce. The funds may have been motivated to sell silver by the threat of higher interest rates in the US, one dealer said, noting that despite silvers precious metal tag, its end uses were heavily industrial based in photographic and electronic applications.

 

The gold-silver price ratio has also had a good correction a dealer said as it expanded from around 65 in mid February to 70 this week. Silver prices have been under some pressure since repeated attempts to push it through $5.30 failed in February and March, dealers said.

One analyst noted that the selling on Wednesday had made the market technically overbought with the relative strength index (RSI) falling to 38-40 which could spark a corrective bounce.

The $4.85 level should hold but if it doesnt, selling below that could take silver down to the mid $4.60s, one dealer said as the market held at $4.84/$4.86 after the gold fix.

Dealers said there was no selling of gold so far which seemed to confirm that the markets concerns were largely focused on silver.

Gold had support at $348.00 but could be limited to a narrow range up to $350.50 today, one analyst said.

Platinum and palladium were both marked lower with silver but their downside has been limited by continuing silence on the start this year of Russian exports to leading consumer Japan.

Platinum was at $366.50/$367.50, down $4.00, and palladium was indicated $2.25 lower at $146.75/$147.75.