Gold futures were rising Tuesday as short covering, bargain hunting and earnings angst increased demand for the metal.
The most actively traded contract was June, which was adding $10.90 to $883.70 an ounce at the Comex division of the New York Mercantile Exchange. Silver prices were adding 16 cents to $12.27 an ounce, and copper prices were rising 3 cents to $1.99 a pound.
Gold futures broke a support level at $885 an ounce, and George Gero, vice president of Global Futures at RBC Capital Markets, estimates the next support area will be $850. "In the past, a selloff turned out to be a buying opportunity,
but we don't know if this is a buying opportunity yet."
Demand usually outpaces producer selling, so on a pullback, investors would seek to increase their gold positions. However, the European Central Bank and the International Monetary Fund are selling gold in the open market.
Gero is waiting to see what happens to the sector once the sales occur. "If it hadn't been for the additional material coming to the market, we would be trading higher.
I am encouraged by the fact that we haven't seen a lot of gold deliveries from rolled over April contracts."
As for stocks,
was trading flat at $42.95.
was up 2.1% to $29.45, and
was adding 1.8% to $8.29.
was up 2.1% to $51.61, and the
exchange-traded fund was rising 1.4% to $86.56.
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Alix joined TheStreet.com TV in February 2007. Previously, she held positions in film and theater production, management, and legal administration. Alix has a degree in communications and theater from Northwestern University.