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Gold last over 500 1987 Original Source Link: (May no longer be active)
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Gold matches 16-year high as dollar nears euro low
SINGAPORE, Nov 15 (Reuters) - Gold touched a 16-year high in Asia on Monday as the dollar traded near a record low against the euro, although a holiday-thinned market held the precious metal back from making more significant gains.
Spot gold was trading at $437.50/$438.25 an ounce by 0424 GMT having hit $438.80 an ounce, a 16-year high also struck on Friday in London trading.
Gold was quoted at $437.70/$438.20 an ounce late in New York on Friday.
Some traders said they expected gold to hit $440, a level last traded in July 1988, during the European trading session after national holidays reduced market activity in Asia.
Singapore and Malaysia were closed for a Muslim holiday on Monday. Markets in Indonesia, which is Southeast Asia's largest gold consumer, are shut the whole week.
The euro was quoted around $1.2963, near a record high of $1.3006 traded last week. The rise in the euro's value has made dollar-denominated gold cheaper for those buying in the European currency.
"I think we have to really watch the dollar," said Martin Mayne, associate director at N M Rothschild in Sydney.
"The market certainly has been talking about $440 level for a few days now and it looks like it would probably give it a go later on today," he said.
In yen-based Tokyo gold futures, the benchmark October gold contract lost one yen per gram to 1,485 yen as the dollar fell to a seven-month low against the Japanese currency, triggering profit-taking.
Some dealers said spot gold's outlook was positive given it held above crucial price support at $430 an ounce last week despite selling by investors eager to take profits.
"Short covering pushed up the price to around $439 this morning but there was no follow through buying. I don't see any support from the physical market," said a dealer in Hong Kong, a key bullion trading city in East Asia.
"We may see a wider trading range in Europe, probably between $435 and $440. If the resistance is broken, the market may go up to $442," the dealer said.
Gold would watch the currency market for direction but market worries lingered that massive long positions in New York's COMEX market could lead to selling.
The latest weekly Commitments of Traders report from the Commodity Futures Trading Commission for the week ended Nov. 9 was delayed until Monday due to the Veterans' Day U.S. holiday on Thursday.
Some traders said gold could trade up to $450 an ounce, a level last seen in June 1988, with some expecting $465 and above as a possibility. Gold last saw prices above $500 in mid-December 1987.
Platinum was at $873/$878 an ounce after hitting a 7-week high at $874 an ounce on buying in Japan. That compared with $871.50/$876.50 an ounce quoted in New York late on Friday.
A key industry report from precious metals refiner Johnson Matthey is due on Tuesday. The report provides estimates on world supply and demand for platinum and palladium.
Palladium rose to $217/$222 an ounce from $215.50/$221.50 in New York.
Silver firmed to around $7.58/$7.61 an ounce from $7.57/$7.60 in New York.
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11/15/2004 00:17
RTR
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