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NEW YORK (
TheStreet ) --
silver prices were higher as traders bought gold ahead of the long holiday weekend but the threat of volatility remains.
Gold for June delivery was adding $10.60 to $1,533.40 an ounce at the Comex division of the New York Mercantile Exchange. The metal has traded as high as $1,535.50 and as low as $1,518.40 while the spot gold price was up $14.50, according to Kitco's gold index.
Silver prices were rising 64 cents to $37.97 an ounce while the U.S. dollar index was shedding 0.66% to $75.08.
While gold and silver prices were rallying into the long holiday weekend, thin volume and technical trading could trump upward momentum.
Traders before a long holiday weekend tend to trade in the morning, put on "safe positions," or buying assets they would feel comfortable leaving their money in for three days, and then check out. Gold sometimes benefits from that as it is considered a safe place to stash cash. On the flip side, traders looking to take profits might sell their gold, which has rallied four out of the past five trading days.
"Physical interest has proved to be robust but more importantly ETP flows have turned positive," writes Barclays Capital in its daily commodity note. "Metal held in trust rose by a modest 0.7 tons yesterday but this marks the sixth consecutive day of inflows, taking holdings to their highest level since the start of the month."
Jon Nadler, senior analyst at Kitco.com, thinks that gold and silver will have to wait for more momentum until after the holiday weekend. "I think you're looking at bargain hunters in the $1,480-$1,500 range in gold but again we have to overcome decisively the $1,530-$1,540 area until we can talk about higher levels."
Short term gold and silver will be forced to take their cue from the dollar and euro as the IMF, European Union and European Central Bank debate how to keep Greece afloat while not sinking other countries or banks that have loaned a lot of money to the country. Any default could spark safe haven buying in gold but a weaker euro would boost the dollar and put pressure on the metals.
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