Skip navigation
Newswire

CORRECTED - Early COMEX gold gets footing after fall from high

In New York story headlined "Early COMEX gold gets footing after fall from high" please read in paragraph 8 "... rose to 107,668 contracts in the week ended Sept. 23 ...", instead of "...the week ended Sept 16 ..." (changes date). A corrected version follows.

NEW YORK, Sept 29 (Reuters) - COMEX gold steadied early Monday as a rebound in the dollar stalled and traders licked their wounds after Friday's $14 shakeout from last week's 7-year highs.

"Intermediate term, it seems like there might be enough spec interest on the long side to try and take the market higher and maybe try $400. I just can't see that as a long-term sustainable price," said James Pogoda, a vice president of precious metals at Mitsubishi International Corp.

COMEX December gold at 0949 EDT was up 70 cents at $382.50 an ounce, still more than $12 below Thursday's $394.80 peak after bouncing from a morning low of $380.20 to $383.70.

Dealers said banks and funds came in to buy the dip. Though large speculators are extremely overbought, the locals sold into the shakeout and had to reverse out quickly.

"The whole ring got short early on the open," said a floor broker. "Some paper got collected right away and took us higher. I think we're probably going lower today but the market's a little shy right now."

Spot gold bullion was quoted at $381.40/2.10, up from $380.60/1.10 late Friday. Monday's morning fix in London was $379.85.

Bullion hit $393.30 Thursday, the highest traded since May 1996. Pogoda said $380 should be important support, even though the spot price dipped below there on Friday. Heavy liquidation would kick in below $375, he predicted.

The CFTC reported late Friday that the net speculative long gold position on the COMEX rose to 107,668 contracts in the week ended Sept. 23, from 105,816 on Sept 16. Nonreportable net long positions increased to 42,829 contracts, up from 41,187 contracts in the previous week.

The broker said COMEX trade was not focused on the Commitments of Traders report, since it omitted the seesaw action of Thursday and Friday.

"While this still leaves about 15,000 contracts of potential buying relative to the 122,847 contract extreme from September 2, it also represents a more substantial risk of long liquidation at some point," wrote analyst Timothy Evans at IFR/Pegasus.

December silver was up 2.5 cents at $5.17 an ounce, trading from $5.14 to $5.185. The contract topped at $5.395, its highest value since July 2000, on Thursday.

Spot silver fetched $5.14/16, up from $5.10/5.12 late Friday. It was fixed at $5.125.

NYMEX October platinum was down $1.40 at $696.00 an ounce. Spot platinum was quoted at $699.00/704.00.

December palladium was $2.55 easier at $209.00 an ounce. Spot was indicated at $206.00/211.00.