Gold slides from record high as profit-takers cash in
Not so fast on those "Gold $2,000" T-shirts.
Some investors and traders finally decided to cash in their recent huge gains in the yellow metal, driving the price down Tuesday after a six-day rally to record highs.
Near-term futures in New York fell $30.40, or 1.6%, to $1,858.30 an ounce in the regular trading session, then slid to $1,835 in electronic trading.
Silver, which had been up for seven straight sessions through Monday, fell $1.04, or 2.4%, to $42.28 an ounce Tuesday. Silver had closed at $43.32 on Monday, its highest price since May 2, when the metal was beginning a steep plunge after hitting a 30-year high.
Precious metals have streaked higher this summer on fears of another global recession and as Europe’s government-debt crisis has worsened. The dive in stock prices since late July also has fed demand for gold as a haven.
Through Monday, gold had risen nearly $400 just since June 30.
But just as some analysts began to talk about a “parabolic” rise in prices, it probably was inevitable that profit-taking would hit.
Next up: Gold’s fans are counting on Federal Reserve Chairman Ben S. Bernanke hinting at another economic-stimulus program when he speaks at a banking conference on Friday in Jackson Hole, Wyo.
Any new money-printing campaign by the Fed could further devalue the dollar and keep gold’s bull market raging.
But note: Bernanke is merely expected to say the Fed stands ready to help, if needed. And if the stock market keeps rallying, Bernanke may have less reason to sound concerned about the economy.
The Dow Jones industrials were up 247 points, or 2.3%, to 11,101 at about noon Tuesday, with an hour of trading to go.
-- Tom Petruno
Photo: Australian gold coins at the Perth Mint. Credit: Ron D'Raine / Bloomberg News