* Spot gold strikes record high at $1,510.80/oz
* Spot silver hits 31-year high at $46.69/oz, RSI at 24-year
high
* Gold seen to consolidate around $1,500 level next week
(Recasts; adds details; updates prices)
By Rujun Shen
SINGAPORE, April 22 (Reuters) - Spot gold surged to a
lifetime high on Friday in holiday-thinned trade, hitting a
record for a sixth consecutive session on a weak dollar and
factors ranging from geopolitical uncertainty to inflation
concerns.
Silver also raced to its loftiest in 31 years, notching the
milestone for a seventh straight day and outstripping gold's
weekly gains by a huge margin.
A prolonged euro zone sovereign debt crisis, unrest in the
Middle East and North Africa, rising global inflation, and most
recently worries over the fiscal stability of the United States
and a sharply weaker dollar have fueled the record-breaking
rally in these precious metals.
Spot gold rose to a record of $1,510.80 an ounce,
before easing to $1,507.10 by 0710 GMT, on track for a weekly
gain of 1.6 percent -- its sixth consecutive week of gains.
Spot silver hit a 31-year high at $46.69 an ounce, on
course for a weekly rise of 8.4 percent, its biggest weekly
increase in two months.
Silver has gained 51 percent so far this year, and gold 6
percent. This compares with a corresponding rise of just 1
percent in the London Metal Exchange price of copper, the
bellwether of the industrial metals complex.
So long as the overall environment remains supportive and
the dollar remains weak, gold is expected to remain strong, but
a correction might be on the horizon after the rapid ascent,
traders and analysts said.
The dollar index , which measures the greenback
against a basket of currencies, was languishing near a
three-year low, and could take a run at the all-time low hit in
2008, pressured by record low interest rates and the crushing
weight of the U.S. budget deficit.
"Gold is likely to consolidate around the $1,500-level next
week," said Li Ning, an analyst at Shanghai CIFCO Futures. "The
angle of the recent rally is very sharp, and we are bound to see
some correction in the near term."
MORE STEAM TO RUN ON?
Spot gold has rallied more than $50, or nearly 4 percent, in
the past seven sessions. The Relative Strength Index, or RSI,
rose to nearly 75, a level unseen since October last year,
suggesting the market has been heavily overbought.
The RSI on spot silver climbed close to 89, its highest
since April 1987.
The gold market may have topped out, and now is the time to
sell while there are still people willing to buy, said Barry
Schwartz, vice president and portfolio manager at Toronto-based
wealth manager Baskin Financial Services.[]
Shanghai CIFCO's Li said gold still has more steam to run on
and expected prices to peak at $1,550 by the end of the second
quarter, buoyed by Middle East unrest, sovereign debt concerns
on both sides of the Atlantic and inflation worries.
Concerns over rising global inflation are likely to drive
gold even higher in the next few years, albeit at a slower pace,
analysts polled by Reuters said. []
The Shanghai Gold Exchange has started a trial for
over-the-counter trading, providing a convenient tool for
institutional clients to trade large quantities of gold.
[]
Holdings in the physically backed exchange-traded precious
metals funds dipped ahead of the long Easter weekend. SPDR Gold
Trust , the world's biggest gold ETF, saw holdings dip 0.6
tonnes to 1,229.643 tonnes.
Financial markets in Singapore and Hong Kong are closed on
Friday for a public holiday, and Hong Kong will remain closed on
Monday.
Precious metals prices 0710 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1507.10 4.36 +0.29 6.17
Spot Silver 46.62 0.06 +0.13 51.07
Spot Platinum 1817.50 6.70 +0.37 2.83
Spot Palladium 763.00 -2.48 -0.32 -4.57
TOCOM Gold 3985.00 3.00 +0.08 6.87 29833
TOCOM Platinum 4831.00 36.00 +0.75 2.87 6069
TOCOM Silver 123.20 2.40 +1.99 52.10 3114
TOCOM Palladium 2030.00 11.00 +0.54 -3.20 150
COMEX GOLD JUN1 1503.80 4.90 +0.33 5.80 112875
COMEX SILVER MAY1 46.06 1.60 +3.59 48.87 134963
Euro/Dollar 1.4579
Dollar/Yen 81.96
TOCOM prices in yen per gram. Spot prices in $ per ounce.
COMEX gold and silver contracts show the most active months
(Editing by Himani Sarkar)
