Barclay's ETF ignites the marketSilver Watch: Barclay's ETF ignites the market
By Jon Nones
27 Jan 2006 at 02:55 PM
March silver was last up 4 cents, trading at $9.645 an ounce, easing back from its $9.75 high, but that nonetheless was a level not seen since 1987, according to MarketWatch.
According media reports, the planned exchange-traded fund investing in silver from Barclays Global Investors moved closer to gaining regulatory approval, igniting the silver market.
"The main driver continues to be the silver ETF and this is taking [silver] to fresh 19-year highs," said Peter Spina, an analyst at GoldForcaster.com.
For now, "technicals for silver remain overbought, but momentum is keeping the run alive," Spina said.
From here, "profit taking should be expected as silver approaches the $10 mark -- with pullbacks finding willing buyers," he said, warning of continuing volatility in the silver market.
Fund buying enabled silver futures to hit 19-year highs today, according to Dow Jones.
"Silver has new sponsorship," said George Gero, vice president with RBC Capital Markets Global Futures. "We are starting to see new funds coming into silver. Part of it has to do with the fact that a lot of traders who follow gold and silver think the silver/gold ratio was out of kilter."
"Silver had been less lively than gold (before Wednesday), and now it's doing a pretty good job of a catch-up," said Gero.
According to Reuters, the market is a buzz after the ETF’s “movement” at the SEC.
"There's been a lot of buying in here because of that - spec buying. Funds are long already," said a floor broker.
"The initial move (up) was a technical one. But right now it's basically being driven by Barclays," said a trader at a precious metals refining company. "There are still people out there with some positions, and of course there will be some profit taking."
Oh yeah, February gold traded at $558.60 an ounce in New York, down $1.30, after trading as high as $564.50. March copper rose 3.25 cents to $2.234 a pound after a record $2.236. April platinum added $11.90 to $1,077 an ounce after a 26-year high of $1,078.90.