U.S. gold prices surged to a fresh record on Monday, its fifth straight, as U.S. and European debt concerns dominated the news. The yellow metal closed above $1,600 an ounce, extending its consecutive string of gains to ten sessions.
"Speculators returned to the commodities’ complex in a big hurry and in a big way last week, as the rolling European debt crisis and the stalling US debt ceiling talks prompted a quest for alternative holdings," noted Jon Nadler, Senior Analyst at Kitco Metals Inc.
"On the other hand, so much of the large gains that the markets have witnessed over the past two weeks has been predicated on two basically unlikely events (the demise of the EU and its currency and the default of the US) that any resolution on either front could spark serious scrambles for the exit doors by the same players at any moment."
August gold prices advanced $12.30, or 0.8 percent, to close at $1,602.40 an ounce on the Comex in New York. Prices ranged from a low of $1,591.40 to a high of $1,607.90. The gain pushed gold prices up 12.7 percent for the year.
"There’s just a lack of confidence in government and currency," Frank Lesh, a trader at FuturePath Trading LLC in Chicago, said in a telephone interview, according to Bloomberg. "There’s a flight-to- safety into gold. When Europe fixes their house and the U.S. fixes our house, maybe then there’ll be in a correction in gold."
Silver prices for September delivery rallied $1.271, or 3.3 percent, to $40.342 an ounce, ranging between $39.280 and $40.375. The metal’s close above $40 an ounce was its best since May 3. Silver has gained 30.4 percent in 2011.
"Recently gold has outpaced silver; however, with gold reaching a record $1,600 per ounce this morning, we think that silver may play catch-up," said Kathleen Brooks, analyst at Forex.com, in a note that was cited on MarketWatch.
Jim Wyckoff of Kitco Metals Inc. wrote the following of silver in the Monday Kitco Metals Roundup:
"December silver futures prices closed near mid-range and hit a fresh 2.5-month high Monday. The silver bulls have the solid overall technical advantage and gained more power Monday by pushing prices above what was strong psychological resistance at $40.00.
Bulls’ next upside price objective is producing a close above solid technical resistance at $42.50 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $38.00.
First resistance is seen at Monday’s high of $40.75 and then at $41.00. Next support is seen at $40.00 and then at $39.50. Wyckoff’s Market Rating: 8.0."
Platinum prices for October delivery rose $19.90, or 1.1 percent, to settle at $1,775.40 an ounce. Platinum’s low for the day was $1,757.00 while its high reached $1,781.60. Platinum prices have fallen a modest 0.2 percent this year.
Palladium prices for September delivery advanced $13.95, or 1.8 percent, to $794.60 an ounce, trading between $781.20 and $796.00. Palladium is down 1.1 percent in 2011.
Earlier fixed London precious metals were higher as well. When comparing London bullion fixings on Monday (PM) from those on Friday (PM), gold prices added $12.00 to $1,599.00 an ounce, silver rose $2.16 at $40.33 an ounce, platinum added $5.00 to $1,765.00 an ounce, and palladium rose $9.00 at $786.00 an ounce.
The United States Mint on Monday published gains in bullion coins for its 24-karat American Gold Buffalo and .999 fine American Silver Eagle. The Gold Buffalo shot up 2,000, raising its July total to 6,000 which tops the 5,500 from the previous month. The Silver Eagle surged 508,500, which notably lifted its 2011 sales to above 24 million. Last year’s annual 34.6 million record will be broken in September at the current sales pace.
The latest United States Mint bullion product sales figures follow:
|US Mint American Eagle and Buffalo Bullion Coin Sales|
|Gold Eagle Coin (1 oz.)||0||56,000||21,500||529,000|
|Gold Eagle Coin (1/2 oz.)||0||0||1,000||56,000|
|Gold Eagle Coin (1/4 oz.)||0||8,000||0||64,000|
|Gold Eagle Coin (1/10 oz.)||0||35,000||5,000||255,000|
|Gold Buffalo Coin (1 oz.)||2,000||5,500||6,000||85,500|
|Silver Eagle (1 oz.)||508.5K||3.402M||1.9695M||24.273M|
|America the Beautiful 5 Oz. Silver Bullion Coin Sales*|
|Gettysburg National Military Park 5 oz.||126,700|
|Glacier National Park 5 oz.||126,700|
|Olympic National Park 5 oz.||80,700|
|Vicksburg National Military Park 5 oz.||21,800|
*America the Beautiful (ATB) Silver bullion coin sales figures are not published by the United States Mint daily. The current year-to-date figure has an "as of date" of July 11.