Gold and Silver Prices Slip, Platinum Futures Plunge over 2%

Gold futures having breached the key resistance level of $1,678 an ounce on Wednesday slipped during Asian trading hours on Wednesday, in spite of weaker U.S. dollar as lack of liquidity and investors’ cautious approach, waiting to get more clear directions from central banks and economic indicators, eased demand. Silver prices also edged lower in early trading on Wednesday.

At around 6:00 a.m. EST, gold futures for February delivery slipped 0.3% to $1,678.80 while spot gold inched up 0.03% to $1,679.00.

According to Wang Tao, a market analyst at Reuters, technical charts are suggesting that gold futures can hit $1,701 an ounce on Wednesday. However, Li Ning an analyst at CIFCO futures in Shanghai, China thinks that short term gains are likely to be capped due to lack of liquidity in the market. Net long positions in gold futures and options have fallen to a four month low.

“Technicals and fundamentals are both supportive of gold, but we are missing the flow of liquidity,” said Li Ning, according to Reuters.

“If we see investors pour more money into this market, it will help confirm the upward trend,” added Ning.

Meanwhile, investors will keep an eye on series economic data, scheduled to be released between Wednesday and Friday, before making any significant investment decision on bullion. While in the U.S., consumer prices, an index of sentiment among home builders and the Fed’s Beige Book are set for a release, China will release its fourth-quarter GDP data. Any weakness or (strength for that matter) in Chinese economy could provide good idea on whether the People’s Bank of China will offer further economic stimulating measures.

Softness in U.S. dollar failed to boost the demand of gold. The ICE Dollar Index, a gauge on U.S. unit’s performance against a basket of six major traded currencies slipped 0.17%. In general, the U.S. dollar and gold prices move in opposite direction.

Silver futures edged down 0.81% to $31.28 an ounce.

In pre-market trading, the iShares Silver Trust (ETF) (NYSE: SLV) was down 0.63%, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) was down 1.56%.

Platinum, having rallied 8% in last six sessions, fell 2.34% to $1,611.50 an ounce, at last check.




Ed Liston is a senior contributing editor at An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.