COMEX gold closes at 1-week low on profit taking

[little devil 77]

COMEX gold closes at 1-week low on profit taking

 

เขียนโดย Griffen

วันพฤหัสบดีที่ ๑๙ มกราคม ๒๕๔๙

 

Wed Jan 18, 2006 2:28 PM ET

Reuters 2006. All Rights Reserved.

 

NEW YORK, Jan 18 (Reuters) - U.S. gold futures settled at a one-week low on Wednesday on investor and fund selling as some players ditched positions to lock in profits from recent 25-year highs after a fall in Tokyo metal prices overnight.

 

At the New York Mercantile Exchange's COMEX division, February delivery gold sank $9.80 to end at $544.50 an ounce, after trading from $558.30 to $543.10, which was its lowest mark since Jan. 11.

 

Dealers said futures extended a pullback from the prior day after Tokyo Commodities Exchange (TOCOM) gold tumbled on heavy selling timed to meet margin calls amid a drop in the Japanese stock market. The Nikkei share average <.N225> fell 3 percent Wednesday in a broad sell-off.

 

"This is all Tokyo profit taking. It is a classic thing: as their stock market dumps, they can't sell their stocks so they have to get out of whatever they're long in, and obviously they're long gold," said a long-time COMEX gold trader.

 

Japanese investors had been big boosters of gold in the last few months as many viewed the precious metals as a preferred asset to hold amid currency weakness.

 

But the market has become increasingly volatile since Tokyo gold margins were raised, prompting occasional long liquidation by some funds and speculators.

 

However, analysts' sentiment on gold remained mainly upbeat and they said it could soon rebound.

 

Gold is up 4.9 percent in 2006, after rising 18 percent last year, on doubts about the economy and fears over high energy prices and global conflicts. But trading has been choppy this year, with speculative and fund selling seen at higher prices, while physical demand has abated above $500.

 

Estimated COMEX gold volume just ahead of the close was 68,000 contracts, against Tuesday's 83,230-lot count.

 

Open interest rose 3,446 lots to 361,704 contracts as of Jan. 17.

 

Tuesday's high in COMEX gold, at $565.50, was the priciest for futures since January 1981.

 

Dealers traced chart support in COMEX gold to $540 an ounce and resistance at $565 and $575.

 

Spot gold traded to $543.60/544.40 an ounce in late New York trade versus Tuesday's close at $553.50/4.30. Wednesday's late London fix by bullion dealers was at $545.

 

"A correction in gold may be useful for the market; we have warned that the metal is trading well above supportive physical demand," said John Reade at UBS.

 

"If the correction takes the metal down to a level where physical demand reappears, then it will help confirm that gold truly has a place above $500/oz this year," he said.

 

U.S. data on Wednesday hardly altered the view that the Federal Reserve will raise interest rates at month-end.

 

Consumer prices in December fell unexpectedly by 0.1 percent but matched market forecasts when energy and food costs were excluded. The core Consumer Price Index rose an as-expected 0.2 percent.

 

Net flows of capital into U.S. assets eased to $89.1 billion in November, which met expectations and was more than the $64.2 billion U.S. trade deficit for the month.

 

Silver prices tumbled after hitting an 18-year high previously at $9.355 an ounce. COMEX March futures lost 20 cents, or 2.2 percent, to end at $8.873, after trading from $9.125 to $8.79.

 

Spot silver fell to $8.80/83 an ounce, from its last New York finish at $8.98/9.01. The fix reached $8.875.

 

In platinum, NYMEX April futures sank $19.20 to close at $1,029.90 an ounce. Tuesday, it hit a 26-year high at $1,059 as strong consumer and investment demand sparked fund buying.

 

NYMEX platinum hit an all-time peak of $1,189.50 an ounce on March 5, 1980, an exchange spokeswoman said.

 

Spot platinum was last worth $1,023/27.

 

March palladium fell $11.45 to $273.90 an ounce. Spot palladium fetched $269/273.