NEW YORK ( TheStreet ) -- Gold and silver prices diverged Friday as investors jumped into gold as a safe-haven asset while silver was dumped.

Gold for August delivery added $9.70 to settle at $1,542.40 at the Comex division of the New York Mercantile Exchange. The gold price has traded as high as $1,548.40 and as low as $1,524.90 while the spot gold price was up $7.80, according to Kitco's gold index.

After a dismal jobs report and an even worse market reaction, investors turned to gold as a safe place to stash cash for the weekend. The unemployment rate rose to 9.1% in May while the private sector added only 83,000 jobs and nonfarm payrolls increased by 54,000 compared to the 151,000 expected. April's numbers were also revised lower.

Although the markets were already pricing in some kind of bad news, the average jobs added during February, March and April were 230,000, so May's reading was particularly disappointing. Gold prices were benefiting from the rush to safety.

Many traders on Thursday had also been considering shorting gold, which means betting prices will fall, so some of Friday's rally might be reversing those positions into the weekend.

"I think a lot of people were anticipating that we would see a much better jobs report," says Phil Streible, senior market strategist at Lind-Waldock, "so people were looking at the short side of the gold market. I think that's a very foolish decision."

The key level experts are watching is $1,550 an ounce. If the dollar is weak and gold powers through that level then the metal could eye its intraday record of $1,577, but the psychological level could also prompt investors to take profits where they can. Gold's record close is $1,557.10 which was hit in early May.

The CME said Friday that gold saw five consecutive days of open interest records, indictating increased long positions, hitting a high of 1,244,620 contracts on May 24, 2011.

On the flip side, silver suffered for most of trading from being an industrial metal Friday rather than a safe-haven currency. Prices recovered late in the day and closed down just 1 cent to $36.19. In after-hours trading silver was adding 2 cents.

"We had three weak ISM reports" from China, the EU and U.S., argued Streible, "so the demand has come down for silver and I think that gold/silver ratio is going to continue to grind its way higher." The higher the ratio means that it takes more silver to buy an ounce of gold which favors a lower silver price and a higher gold price.

Gold mining stocks were mostly higher. Kinross Gold ( KGC) was up 1.36% at $16 while Yamana Gold ( AUY) was also adding 1.36% at $12.68. Other gold stocks, Agnico-Eagle ( AEM) and Eldorado Gold ( EGO) were trading mixed at $65.47 and $14.92, respectively.

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-- Written by Alix Steel in New York.

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