* Spot gold hits record above $1,500/oz
* Spot silver rises to 31-year high of $44.34
* Coming up: U.S. existing home sales, March; 1400 GMT
(Adds gold hitting record high)
By Rujun Shen
SINGAPORE, April 20 (Reuters) - Spot gold prices breached
$1,500 for the first time 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.
Lofty oil prices, inflation concerns, worries over the euro
zone sovereign debt crisis as well as political tensions in
places like the Middle East should keep gold strong for the time
being, analysts said.
"There are not a great deal of reasons to sell it at the
moment, apart from concerns that there are a lot of longs in the
market and there is a risk of sell-off at some point," said
Darren Heathcote, head of trading at Investec Australia.
Spot gold rose to $1,500.16 an ounce before easing
slightly to $1,499.10 by 0513 GMT, up 0.4 percent. U.S. gold
futures <GCcv1> rose to a record of $1,500.90.
The dollar index , a measure of the greenback against
a basket of currencies, softened towards its 16-month low hit
last week, boosting the appeal of gold in non-dollar denominated
currencies.
Technical analysis also points to a further rally in gold
targeting $1,518, according to Reuters market analyst Wang Tao.
[]
Some market watchers see gold consolidating at its current
level as it waits for the next reason to push higher.
"I don't see prices convincingly past 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," said Natalie Robertson,
commodities strategist at ANZ.
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. []
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 $44.34, 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 the metal, which benefits both from safe
haven demand and growing industrial consumption. []
"Silver is still in a clear bull trend that targets $50.00
next," said Taso Anastasiou, a UBS technical strategist.
He said the medium-term trend was bullish, but warned that
silver might go through a correction in the near term 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 0513 GMT
Metal Last Change Pct chg YTD pct chg Volume
Spot Gold 1499.10 5.20 +0.35 5.61
Spot Silver 44.25 0.36 +0.82 43.39
Spot Platinum 1785.24 23.74 +1.35 1.00
Spot Palladium 740.22 13.27 +1.83 -7.41
TOCOM Gold 4006.00 46.00 +1.16 7.43 51363
TOCOM Platinum 4803.00 51.00 +1.07 2.28 10144
TOCOM Silver 118.00 4.60 +4.06 45.68 2716
TOCOM Palladium 1990.00 35.00 +1.79 -5.10 236
COMEX GOLD JUN1 1499.80 4.70 +0.31 5.52 11946
COMEX SILVER MAY1 44.27 0.36 +0.81 43.08 6312
Euro/Dollar 1.4386
Dollar/Yen 82.93
TOCOM prices in yen per gram. Spot prices in $ per ounce.
COMEX gold and silver contracts show the most active months
(Editing by Michael Urquhart)
