Gold Rises Slightly, Silver Falls Back Under $17 – 1/26/2010

by Bullion Prices Staff on January 26, 2010

US gold prices on Tuesday rose for a second straight day as the dollar pared earlier gains. Other metals fell, however, as worries of demand surfaced following news that China had began to tighten lending. By the end of the day, gold rose 0.2%, silver fell 1.7% and platinum ended down 1.0%. New York precious metal figures follow:

  • Gold for February delivery rose $2.60 to close at $1,098.30 an ounce. The yellow metal ranged from $1,085.20 to $1,103.20.

  • Silver for March delivery fell 28.5 cents to finish at $16.860 an ounce. It ranged from $16.340 to $17.270.

  • April platinum declined $14.80 to end at $1,531.30 an ounce. It ranged from $1,563.50 to $1,501.10.

In PM London bullion, the benchmark gold price was fixed earlier in the North American day to $1,093.25 an ounce, which was down $2.00 from Monday. Silver fell 37 cents to $16.790 an ounce. Platinum was settled at $1,512.00 an ounce for a loss of $31.00.

Notable bullion quotes follow:

"If the dollar strengthens further and risk aversion increases, gold could break below major support area at $1,080" and a test of $1,000 is possible, Donald Selkin, chief market strategist at National Securities Corp, said on Reuters.

"As long as the dollar doesn’t strengthen anymore from here, gold is a buy," Frank McGhee, the head dealer at Integrated Brokerage Services in Chicago, said on Bloomberg.

"Bullion prices wiped out yesterday’s hard-fought gains as well as their initial overnight advances in the wake of China’s implementation of lending freezes on local banks," wrote Jon Nadler, senior analyst at Kitco Metals, Inc.

"Liquidation patterns may emerge as February COMEX options expire later on today and players clean particular slates. About the only potentially gold-supportive agent for the remainder of the week might be a dovish Fed statement on Thursday, which could elicit some profit-taking among dollar longs."

New York crude-oil for March delivery declined 55 cents, or 0.7 percent, to $74.71 a barrel.Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

In related bullion news about the US Mint, Silver Eagle sales have topped 3 million, registering their best ever January. Despite obstacles, authorized purchasers ordered 3,090,500 of the silver coins as of Friday, Jan. 22.

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