COMEX Gold Extends Win Streak to Four, XAU Rises 1.3%

Precious metals finished in positive territory on Monday as they built on last week’s gains in spite of a firmer U.S. dollar.

COMEX gold futures, per the August contract, settled higher by $0.70 at $1,618.70 per ounce after hovering near unchanged for much of the day.  In doing so, the yellow metal posted its fourth consecutive session of gains and stretch its advance in July to 1.2%.

Commenting on the gold market, analysts at UBS wrote in a note to clients that “Right now, it’s clear that sentiment is clearly turning in gold’s favour.  But it’s also clear that despite last week’s inflow of fresh longs, some hesitancy abounds.”

“A much bigger pool of investors, while starting to pay attention to gold again, are biding their time before getting long,” UBS added.  ”Investors are playing the waiting game, looking for the signal to get back in.”

Such a signal is likely to come in the form of further monetary easing by the Federal Reserve, according to UBS, although the firm did not specify if it believes QE3 will be announced at this week’s FOMC meeting.

Silver futures outperformed gold today, with the September COMEX contract closing up by $0.53, or 2.0%, at $28.03 per ounce.

Gold and silver shares climbed alongside the metals on Monday, as the Philadelphia Gold & Silver Index (XAU) rose 1.3% to 153.82.  A particularly encouraging sign for the sector was that today’s rally came despite a slew of disappointing earnings results and cautious analyst commentary this past Friday and this morning.

Barrick Gold (ABX) and Goldcorp (GG) each shrugged off multiple price target reductions to finish up by 2.2% at $33.06 and by 0.9% at $36.57 per share, respectively.

Among silver shares, Silver Standard Resources (SSRI) advanced 2.9% to $13.07 per share while Silver Wheaton (SLW) rose by 2.1% to $28.06 per share.