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Gold silver prices

loss ground in NY

NEW YORK: Comex gold settled lower in thin, lethargic trade on Wednesay continuing the rangebound activity of recent sessions.

A brief afternoon excursion above the unchanged level, spurred by a spike in grain and soy prices, ended abruptly as the market failed to attract follow-through buying.

June gold ended $0.70 lower at $392.70 an ounce, traded from $393.60 to $392.40. Volume was light at an estimated 15,000 lots, little changed from Tuesday's official 15,868.

Dealers quoted bullion at $390.60/$390.90.

The market has repeatedly tried but failed in recent weeks to rally in tandem with surging grain and petroleum prices.

Traders said gold prices remained hemmed in by physical demand underneath and the prospect of producer selling and stale long liquidation overhead.

"The longer the market stays at this level, the antsier producers become and the more comfortable they are about selling here," said one cash market source. "The physical demand can't absorb all of the selling that the producers have to do."

He expected spot prices would test support at $390.50, with major support pegged at $387.50. Resistance was seen at $393 and $395.

Some traders also saw Friday's pending over-the-counter options expiry helping to keep spot prices confined between the $395 and $390 strike prices, although others downplayed its significance. SILVER: Comex silver settled modestly weaker in rangebound trade, unable to break through resistance in the afternoon when a spike in grain and soy prices encouraged players to probe the upside.

May silver settled 2.3 cents lower at $5.292 an ounce, traded narrowly from $5.325 to $5.285. July was off 2.5 at $5.342, traded from $5.375 to $5.335.

Volume was estimated at 21,000 lots, including 3,365 switches as players rolled positions forward into the July contract from May ahead of first notice day next week.

Comex silver warehouse stocks Wednesday rose marginally by 100,884 ounces to 142,124,664.-Reuter