Gold strikes 16-year high; Passes $450 an ounce

Gold rushed passed its 16 year high to more than $450 an ounce Thursday, before pausing as players began to eye the next big target of $455, Reuters reports.

With U.S. markets closed for the Thanksgiving holiday Thursday and Friday, analysts and traders reportedly said gold might again challenge the day’s peak, driven by an ailing dollar in conditions made thin and volatile by the U.S. holiday, Reuters reports.

Barclays Capital’s Kamal Naqvi reportedly said the market was looking at new resistance levels. “People tell me the next resistance level is $455, but our technical analysts actually say higher at about $461,” he said.

Spot gold closed in London Thursday at $451.50 an ounce, up from New York’s late close of $448.75/$449.50, but below the 16-1/4 year high of $452.75 touched earlier in the session.

Gold has gained 13% since early September, climbing steadily on the back of a weakening dollar, which makes dollar-priced gold cheaper for buyers in other currencies. The euro was seen sitting firm at $1.3216 near all-time highs of $1.3237 set earlier Thursday, Reuters reports.

Analysts and traders reportedly said the euro/dollar rate was still the key driver for gold, but they expected a small retracement as players took profits before the metal consolidated above $450.

Traders were also watching for possible intervention by the Bank of Japan, which is worried about dollar-yen levels, Reuters reports.