Gold and Silver Miners Ignore Euro Weakness

On Wednesday, gold (NYSEARCA:GLD) futures for June delivery dropped $28.20 to settle at $1,548.40 per ounce, while silver (NYSEARCA:SLV) futures fell 66 cents to close at $27.52.

Precious metals and equities declined across the board as the euro plummeted to its lowest level in nearly two years today. The euro fell to as low as 1.2546 and the U.S. dollar index rallied to 82.22, creating a new 52-week high.

Don’t Miss: What are Hedge Funds Doing With Gold?

“As long as major central banks refrain from any new liquidity action in the form of FX swaps and the International Monetary Fund remains silent before the Greece June 17 elections, the path of least resistance for traders is continue selling the euro rallies and eventually targeting the 2010 lows under $1.18,” explained Ashraf Laidi, chief global strategist at trading platform City Index.

In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) declined .74 percent, while the iShares Silver Trust (NYSEARCA:SLV) fell 1.57 percent. Despite the pullback in bullion prices, miners rallied as investors seek value in the heavily discounted sector. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Yamana Gold (NYSE:AUY) jumped 4.5 percent and 3.5 percent, respectively. Silver names such as Coeur d’ Alene (NYSE:CDE) and Silver Wheaton (NYSE:SLW) both gained more than 2 percent.

Investor Insight: How Strong is Global Gold Demand?