(OroyFinanzas.com) – Market was very thing and quiet overnight, on the first day of the new fiscal year for most of the Japanese companies. Gold traded up to $666 paid on the EBS, but Tocom pre-open selling took the prices about a dollar lower.

The yellow metal remained bounded by a two dollar range throughout the Far East session with the $665 level seeming to provide a resistance. During the European hours spot did not manage to break higher as there was very little interest in the market. The metal continues to draw support from the Iranian crises. The country’s television released a fresh footage of the 15 detained British naval personnel today. A report stated that they have all admitted entering Iranian waters illegally. The new video showed other members of the group talking and pointing to a map to show where they were seized, but their voices could not be heard.

The television reportsaid: “It seems that Britain has shifted a little bit from its stance in the past one or two days over the undeniable fact. If this path continues, one can hope that the issue would be resolved in a bilateral process”. On the other hand British Foreign Office spokesman said that he did not think that the position had changed as far as Britain is concerned – the sailorswere seized in Iraqi waters. Iranian President Mahmoud Ahmadinejad said that Britain should have apologized and some officials criticized Britain for taking the issue to the United Nations. US dollar steadied against major currencies as investors awaited key US economic data due later this week, which could provide hints about Federal Reserve’s future interest rate policy direction.

The precious metal lacked momentum for the past couple of weeks to break the key technical levels and a retreat in the oil prices due to profit taking some what lowered its inflation hedge appeal. Subsequently the prices extended the Asian range on the downside and fixed at $663.30 on the first London fixing, down 20 cents from the previous AM one. The metal’s weakness did not stop there with the spot progressively loosing ground. After the opening of the Comex division of the New York Mercantile Exchange some follow through selling forced the prices down to $658 levels and after a short lived rebound further down to $656.50. The Institute of Supply Management said today that its index of national factory activity fell to $50.9 in the month of March verses 51.1 expected. A reading above 50 indicates growth in the sector even though it slowed from 52.3 in February. Prices had difficulty recovering the losses and fluctuated around $660 levels for a couple of hours before the news of US officials stating that they are seeking information from Iran about missing American via Swiss diplomatic channels. The news pushed the yellow metal to slightly extend top side of the intraday range and closed there. We are moving to a traditionally strong period of physical demand and we believe that that along with the firm oil prices and geopolitical tensions will continue to provide a support.

Silver barely had any range in Asia today with prices hovering just below the $13.40 level around which a lot of overseas selling interest was seen. During our time zone a very quiet and narrow range trading prevailed until the opening of the NY trading session. The white metal then followed gold in its weakness and prices dropped all the way down to $12.99. The dip below the $13 psychological support was very short lived though. Spot then managed to recover a majority of the intraday losses. We believe that inthe short term the $13.00-13.50 range will prevail.

MKS Gold & Silver, Daily Report
By Lidia Nazarova

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