Gold prices were climbing slowly higher Thursday, buoyed by a weaker U.S. dollar and haven buying amid global uncertainty.
Gold for April delivery was adding $7 at $1,403.10 an ounce at the Comex division of the New York Mercantile Exchange. Gold has traded as low as $1,386.80 and as high $1,406.60. The spot price was up $2.70, according to Kitco’s gold index.
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Silver prices were choppy, gaining 9 cents to $34.56 an ounce. “Seems like there is tremendous fluctuation in the price of silver because of Japan and the stock market,” Mihir Dange, of Arbitrage, said as to why the silver price is struggling while gold is steady. “The number in silver we are looking at is $33.63. A close below (that level) will sell us down to $31.50-$32.00. Staying above should get us back into the mid-$35s.”
James Moore, a research analyst at FastMarkets, said gold has found support at $1,380.80. The SPDR Gold Shares (GLD) added almost 5 tons Wednesday as buying ramped up.
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Investors seem wary, given the unpredictability of global events, and worries mounted that a nuclear meltdown may occur in Japan after EU and U.S. officials both said the situation is worse than Japan has let on.
All information is coming from Tokyo Electric Power, the owner of the Fukushima nuclear plant in crisis. Governments are forced to act on limited information, so everything is a guess. Helicopters are making a desperate effort to control the overheating reactors by dropping water on the Fukushima plants with radiation levels supposedly very high.
This backdrop is confining gold to a tight trading range as some investors buy the metal to protect themselves from a disaster while others sell their positions to obtain cash, keeping a lid on prices. Investors are also pouring back into stocks to take advantage of an oversold environment.
By midmorning, the Dow Jones Industrial Average ($INDU) was up by 150 points, or 1.3%, at 11,763. The S&P 500 ($INX) was up by 20 points, or 1.6%, to 1,277 and the Nasdaq ($COMPX) was rising 41 points, or 1.6%, to 2,658.
