* Spot silver hits 31-year high of $44.30/oz
* Gold sees strong support at $1,490, eyeing $1,500
* Coming up: U.S. existing home sales, March; 1400 GMT
(Adds details, comments; updates prices)
By Rujun Shen
SINGAPORE, April 20 (Reuters) - Gold prices held steady
below $1,500 and silver hit a 31-year high on Wednesday,
supported by a weak dollar and concerns over a sovereign debt
crisis in the euro zone.
After U.S. gold futures breached $1,500 in the previous
session, spot gold is expected to rise beyond the key
psychological level, but choppy trade is seen going forward.
"Fifteen hundred dollars seems to be a natural psychological
barrier," said Natalie Robertson, commodities strategist at ANZ.
"I don't see prices convincingly pass that level in the next
few days unless we see something very negative, probably related
to the euro zone sovereign debt. But we do see gold very well
supported at the $1,490 level."
Fears over a potential downgrade of the U.S. credit rating
eased after U.S. Treasury Secretary Timothy Geithner tried to
reassure investors the country's two parties were making
progress on reducing the deficit, she added. []
A weakened dollar lent support to precious metals. The
dollar index , a measure of the greenback against a basket
of currencies, softened towards its 16-month low hit last week,
after the euro and commodity currencies rebounded from a
sell-off earlier in the week.
Spot gold edged up 0.3 percent to $1,497.80 an ounce
by 0331 GMT, after rising to a record of $1499.31 in the
previous session. U.S. gold futures <GCcv1> inched up 0.2
percent to $1,498.60.
Gold still targets $1,518, said Reuters market analyst Wang
Tao. []
SILVER HITS 31-YEAR HIGH
Silver continued to charge ahead, rising to a 31-year high
for the fifth consecutive session, as investors continued to
favour gold's less expensive cousin.
Spot silver rose to $44.30, a level unseen since
1980, before easing slightly to $44.25, up 0.8 percent.
Analysts and traders expected silver to continue to shine,
as investors favour silver which benefits both from safe haven
demand and growing industrial consumption. []
Technical analyses confirmed the bullish sentiment in
silver.
"Silver is still in a clear bull trend that targets $50.00
next," said Taso Anastasiou, a UBS technical strategist.
He said medium-term trend following indicators continued to
highlight a bull trend, but warned that silver might go through
a correction in the near term before resuming the uptrend, as
the metal has been very overbought.
"My key medium-term support level lies at $33.00 and while
it is difficult to identify what would cause silver to sell off
aggressively, there is an increased chance we will see
a correction towards the $35.00 to $33.00 area."
The Relative Strength Index on spot silver rose to above 84,
a level unseen since February 2008, indicating a heavily
overbought market.
Precious metals prices 0331 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1497.80 3.90 +0.26 5.52
Spot Silver 44.25 0.36 +0.82 43.39
Spot Platinum 1784.49 22.99 +1.31 0.96
Spot Palladium 738.22 11.27 +1.55 -7.66
TOCOM Gold 4010.00 50.00 +1.26 7.54 41789
TOCOM Platinum 4815.00 63.00 +1.33 2.53 7912
TOCOM Silver 118.10 4.70 +4.14 45.80 2411
TOCOM Palladium 1989.00 34.00 +1.74 -5.15 190
COMEX GOLD JUN1 1498.60 3.50 +0.23 5.43 7837
COMEX SILVER MAY1 44.28 0.37 +0.84 43.12 4740
Euro/Dollar 1.4394
Dollar/Yen 83.07
TOCOM prices in yen per gram. Spot prices in $ per ounce.
COMEX gold and silver contracts show the most active months
(Editing by Clarence Fernandez)
