Gold hits 25-year high in Asian markets

Gold hit a new 25-year high above $684 an ounce on Monday as Japanese investors returned to the market after a long holiday but was later in retreat, raising fears bullion may be ripe for a correction.
Spot gold rose as high as $684.70 an ounce before slipping to $681.00/682.00, down from $682.10/683.10 late in New York on Friday. In Asian trade on Monday it touched a low of $679.10 an ounce.
Gold soared to an all-time high of $850 in 1980.
Most active gold futures on the Tokyo Commodity Exchange rose by 57 yen to 2,491 yen per gram as sharp gains in New York ignited active buying by Japanese funds and retail investors.
It was the highest level for a benchmark TOCOM gold contract since September 1985.The contract was later quoted at 2,476 yen per gram, up 42 yen.
"The trend is still up but Warren Buffett was saying the commodities market is driven more by speculative buying than fundamentals. That may give a good hint to speculators," said a dealer in Hong Kong.
"Unless there's pretty good buying from investors, the market will be in a consolidation phase," he said.
Berkshire Hathaway Inc Chairman Warren Buffett said on Saturday he thought there had been market speculation in commodities such as copper, and also said he no longer had a holding in silver.
Silver hit a 23-year peak of $14.68 on April 20.
Commenting on the commodities market in general, Buffett said: "What the wise man does at beginning, the fool does in the end any asset that has a big move based on fundamentals will attract speculators..."
Dealers pegged support level at around $675 an ounce for gold, while resistance would seen t $685 and $686 an ounce. Gold, which has gained 32 percent this year due to tension in the Middle East, recorded high oil prices and a volatile dollar is seen as technically overbought, said dealers.
"Although the market sentiment towards the metal remains upbeat, gold will be vulnerable to shart short-term corrections," said N M Rothschild in a daily report. Platinum rose to $1,183/1,188 an ounce from $1,178/1,183 in New York. Palladium also rose to $375/380 an ounce from $370/375. Silver edged up to $13.98/14.08 from $13.91/14.01 in New York.