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Reuters Gold

Reuters Gold

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Published by zerohedge

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Published by: zerohedge on Apr 26, 2011
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Silver headed for its biggest daily loss in more than amonth, giving up 3 percent to end a nine-session win-ning streak that carried it to within 17 cents of the 1980record high. Spot gold fell 0.6 percent to $1,499.60 anounce, after a seven-day record-setting rally that hadpushed prices to $1,518.10.
A worker casts a gold bar of melted gold jewellery at the Austrian Gold and Silver Separating Plant 'Oegussa' in Vienna February 28, 2011. REUTERS/Lisi Niesner
Silver tumbles, snaps rally ahead of option ex-piry
By Rujun ShenSINGAPORE, April 26 (Reuters) -
ilver prices fell nearly five percent on Tuesday, snappinga rally in previous sessions that had carried them closeto a record high, as option traders sold back metal tocover risks ahead of options expiry later in the day.Spot silver prices had exploded in Monday's session, soaringto within 17 cents of the 1980 record high as options sellersbought silver when key strike levels at $45 and $50 came un-der threat of exercise."People are watching out for options expiry," said Yingxi Yu,an analyst at Barclays."There are decent-sized open interests at the strike levels of$40, $45 and $50. When there are large positions, it tends tosuggest that prices may sway to those levels on options ex-piry."U.S. silver futures tumbled nearly 5 percent to $44.86 anounce by 0418 GMT, after having rallied to $49.82 in the pre-vious session, a hair off their record high of $50.35.Spot silver dipped 4.4 percent to $44.84."The market will remain very nervous, and we'll see how itgoes after option expiry," said a trader in Singapore.Gold,silver ETFs holdings: (
)Spot gold fell by 0.7 percent to $1,497.25 an ounce, after aseven-day record-setting rally that pushed prices to$1,518.10 on Monday.U.S. gold also lost 0.7 percent to $1,497.90.There is high open interest at key strike levels of $1,500 and$1,520 on COMEX gold, which will keep prices stable until atleast later in the day, traders also said.Investors are eyeing the U.S. Federal Reserve's policy settingmeeting, due to kick off later in the day.Fed chief Ben Bernanke is scheduled to give a news briefingon Wednesday -- the first regularly scheduled by a Fed chiefin its 97-year history -- that is expected to shed light on thecentral bank's policy stance."The market will be watching out for any signs of what theFed is going to do at the end of the second round of quanti-tative easing," said Yu of Barclays."If Bernanke remains dovish, as he has been, it will provideindication that monetary policy will not be tightened signifi-cantly in the second half, which is pretty favourable for pre-cious metals."The dollar edged up on Tuesday, but is still seen wobbly,even after the euro slipped on remarks from the EuropeanCentral Bank Governor Jean-Claude Trichet that a strongdollar is in the interest of the United States. [USD/]Platinum group metals fell in tandem with gold and silver.Spot platinum fell off a seven-week high of $1,836.74, down1 percent to $1,801.99.
(Continued on page 3)
Traders work in the gold and silver options pit on the floor of the New York Mercantile Exchange March 7, 2011. REUTERS/Lucas Jackson
Spot palladium declined 1.2 percent to $749.Euro/Dollar 1.4530Dollar/Yen 81.64COMEX gold and silver contracts show the most activemonths
Volatile silver cuts early gain toward 1980 record
By Frank TangNEW YORK, April 25 (Reuters) -
ilver surged as much as 8 percent on Monday beforepulling back sharply when a failure to pierce the alltime high from 1980 unleashed a wave of technicalselling amid record volume in U.S. futures.After briefly dipping into negative territory midmorning asspeculators sharply took profits near the $50 psychologicallevel, silver later found its footing again. The metal tradedlargely flat, steadying at just below $47 after the CME Groupraised the maintenance margins of silver futures by 9.2 per-cent.Gold prices also recoiled from early gains of nearly 1 percentafter touching a seventh successive record high with volatilityspiking to its highest since November.The whipsaw in silver prices amid otherwise thin trading mar-ket conditions was a stark reminder of the volatile nature ofthis year's best-performing major commodity, which hasgained about 150 percent since the U.S. Federal Reserve sig-naled new easing measures last August. Silver has risen fornine straight days, matching a record winning streak from2008.Silver five-minute chart (
)Graphic on gold, silver prices (
)"Silver has transformed itself from an inflation hedge to aspeculation tool," said Hakan Kaya, commodities portfoliomanager at Neuberger Berman, which manages about $190billion client assets."At current prices, we find it highly overvalued with no funda-mental reasons backing it up."While often overshadowed by gold, the smaller silver markethas handily outpaced the yellow metal's 25 percent gains overthe same period. Prices look set to challenge the record$49.48 an ounce from three decades ago when Texan broth-ers William Hebert and Nelson Bunker Hunt sought to cornerthe market.Spot silver was up 1.4 percent at $47.34 an ounce by 3:39p.m. EDT (1939 GMT), sharply below a session high of $49.31.Spot gold was at $1,509,60 an ounce, up 0.4 percent, well offan a record high of $1,518.10 set earlier in the session, in tan-dem with silver's reversal. U.S. June gold futures settled up$5.30 at $1,509.10 an ounce, in a range from $1,502.20 to$1,1519.20.VOLUME AT RECORD HIGHU.S. May silver futures jumped as much as over 8 percent to aintraday high of of $49.82 an ounce, just about 50 cents off itsall-time peak for futures at $50.35 hit on Jan. 18, 1980. Maysettled up $47.149 an ounce, up $1.09.
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Metal Last Change Pct chg YTD pct chg VolumeSpot Gold 1497.25 -11.2 -0.74 5.48Spot Silver 44.84 -2.06 -4.39 45.3Spot Platinum 1801.99 -17.31 -0.95 1.95Spot Palladium 749 -8.8 -1.16 -6.32COMEX GOLD JUN1 1497.9 -11.2 -0.74 5.38 17564COMEX SILVER MAY1 44.86 -2.29 -4.85 44.99 33349

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