NEW YORK ( TheStreet) -- Gold prices are posting gains for the seventh of the past eight sessions as a raft of influences were providing positive momentum for traders. Gold for December delivery at the COMEX division of the New York Mercantile Exchange was tacking on $6.40 to $1,367.30 an ounce late Friday morning. The gold price traded as high as $1,374.30 and as low as $1,357 an ounce, while the spot price was increasing $2.96. The yellow metal is up about 4% during August. Analysts initially deemed the August move a short-covering trade, but many now say it could be a rally with more gains ahead. "The fact that gold is rallying with base
metals as yields rise certainly suggests that there is something 'out of the norm' going on - to us it represents the market making a bet on future Fed actions," Marex Spectron wrote in a note Friday morning. "One could dismiss it is a short squeeze but ultimately what is the difference between a 20% short squeeze and a 20% bull market?" Analysts from JPMorgan echoed a similar sentiment in a research note to clients on Thursday, advising clients to purchase gold. "Buy the bounce," precious metals analysts John Bridges and Anant Inani wrote in the research note's headline. Gold's huge rise on Thursday following the revelation that Paulson & Co. cut its gold position in half, Bridges and Inani suggested, meant the move "may be delivering an exclamation mark to define the end of the 10-month, 25% fall in gold and 50% fall in gold equities." Michael Smith, president of T&K Futures and Options, said in a phone interview that gold traders are not dismissing escalating violence in Egypt. "This new violence has really got people scared," Smith said. "I think that it's the safe-haven trade all over again, like we saw two years ago when Greece was going to collapse and Italy and all the gold people ran to gold again for the currency hedge." Silver prices for September delivery were climbing 17 cents to $23.10 an ounce, while the U.S. dollar index moved higher by 0.16% to $81.30.
Silver has surged 18% since the start of August, making it the most appealing precious metals asset to trade. The surge may not be over, either. "Silver certainly gives you more alpha," Rick Rule, chairman of Sprott USA, said in an interview. "If you're buying silver... to preserve your purchasing power over time or maybe to get a little alpha over the gold trade -- the gold precious metals trade -- then by all means this is a fair time to be in the market." Gold mining stocks were mixed on Friday. Shares of Newmont Mining ( NEM) were falling 2%, while shares of Royal Gold ( RGLD) rose 1.2%. Among volume leaders, Barrick Gold ( ABX) was off 2.2%. Gold ETF SPDR Gold Trust ( GLD) was up 0.21% to $131.96 a share, while iShares Gold Trust ( IAU) was down 0.32% to $13.28. -- Written by Joe Deaux in New York. >Contact by Email. Follow @JoeDeaux