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07 December 2010

Precious Metals correct as traders book profits

Gold corrects to $1400 while silver falls to $28.60

Bullion's sharp assent over the past few days looked a little too good to be true, and this afternoon it proved that it wasn't as Gold and Silver both corrected.

Comparatively few sales against a backdrop of heavy traffic at over the past few days perhaps indicated that precious metal buyers were a little uncomfortable at these levels, and the current correction is likely to provide opportunity to buy.

Some analysts said that declining volumes in precious metals futures could signal negative pressure on Gold and Silver prices in the short term, or that teh precious metals may already have reached short-term tops as speculative interest faded.

Nonetheless, precious metals are likely to remain supported by concerns over the financial health of the euro zone, talk of a further round of quantitative easing in the US and heavy buying from emerging nation economies.

Interest at saw interest in Gold again marginally higher than silver, with premiums for 1 Kilo Gold Bars trading at an average of 6.57% over fix.

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