Gold steady!!
Gold steadied on Friday as light buying emerged on dips toward $1 000 per ounce, after it declined $12 in the previous session from an 18-month high.
Despite some technical indicators suggesting the market may be overbought, sentiment remained firm, analysts say, and many market participants still expect gold to break through its record high of $1 030,80 an ounce.
Spot gold was at $1 012,25 per ounce as of 0330 GMT, slightly up from New York’s notional close of $1 011,45. It is on track to post a 0,7% rise for the week.
"It’s still well above the $1 000 mark… I’m sure there will be ups-and-downs day by day, but I expect upward pressure on gold to stay for a while," said Tatsufumi Okoshi, a senior economist at Nomura Securities Co.
"There are opportunities for investors to take advantage of increasing liquidity provided by major central banks. But the situation is the same as before — there’re few attractive assets other than gold," he said.
Trade in Asia was relatively slow ahead of a long weekend in Japan. Tokyo’s financial markets are closed from Monday to Wednesday next week for national holidays.
On Thursday, gold hit a high of $1 023,85 per ounce, a hefty $74,2 above the level at the end of August. It topped $1,020 for the second straight day, when a measure of global equities reached an 11-month high.
But data showed there was no money inflow into the world’s largest gold-backed exchange-traded fund on Thursday, suggesting that the day’s rally was mainly driven by short-term investors building up long gold futures positions.
The SPDR Gold Trust said its holdings stood at 1 086,479 tons on Thursday, unchanged from a day earlier and up about 22 tonnes from the end of August.
US gold futures for December delivery stood at $1 013,90 an ounce. On Thursday the contract fell $6,70 to settle at $1 013,50 on the COMEX division of the New York Mercantile Exchange after hitting a high of $1 025,80.
Gold has benefitted from a lack of investor confidence in prospects for the global economy and will likely do so until company managers boost earnings forecasts, Nomura’s Okoshi said.
In addition, increasing debt issues by the US Treasury and diversification fears undermining the U.S. currency mean gold often attracts the most of safe-haven demand, traders said.
The US currency has retreated broadly since March as investors shifted into riskier assets due to increasing signs that the global economy was on the mend.
