* Platinum seen overbought, could tumble once strikes end
* Gold flat, retreats from 6-month high as market awaits Fed
* Silver demand seen not sustaining price above $30-analyst
* Coming up: U.S. Fed rate decision, policy statement
Thursday
By Frank Tang
NEW YORK, Sept 12 (Reuters) - Platinum rose almost 3 percent
on Wednesday, its biggest one-day rally in a month, boosted by
supply fears after sprawling labor unrest halted production at
some mines in top platinum producer South Africa.
Gold was up by just pennies, retreating after hitting a
six-month high during the session. Some investors scaled back
their bullish bets before a Federal Reserve decision on Thursday
about new economic stimulus.
Machete-wielding strikers forced No. 1 platinum producer
Anglo American Platinum to shut down some South African
operations, widening the labor unrest sweeping the country's
mines. South Africa has 80 percent of the world's platinum
reserve.
The price of platinum, mostly used as an autocatalyst to
clean auto emissions, has soared 11 percent in the last eight
sessions. The metal's relative strength index (RSI) rose above
80 on Wednesday to its most overbought level since early 2008.
"Platinum's rally is very strike-specific at this point, and
it may pull back when the supply worries are over, as platinum
is now getting significantly overdone," said Frank McGhee, head
precious metals trader Integrated Brokerage Services LLC.
Spot platinum rose 2.8 percent to $1,644.74 an ounce
by 2:10 p.m. EDT (1810 GMT), its biggest one-day percentage gain
since Aug. 16. Wednesday's high of $1,654.49 marked its best
level in five months.
U.S. NYMEX October platinum futures settled up $42.60
at $1,649.60 an ounce, with volume almost double its 250-day
average, preliminary Reuters data showed.
Palladium rose 1.6 percent to $676.47 an ounce.
The price of platinum has risen nearly 20 percent since a
strike at the world's third-largest producer, Lonmin,
turned violent last month, leaving 44 dead and dozens injured in
clashes between police and striking workers.
Despite rising supply fears in South Africa, a forecast
surplus in platinum due to faltering demand from the European
car industry could limit further price gains, analysts said.
"Prior to this, this was a market that was in surplus this
year. It might move toward balance, but it's not a market that
is going to be in a significant deficit this year," said David
Jollie, analyst at Mitsui Precious Metals.
ALL EYES ON FOMC
Gold retreated as some investors took profits after an 8.5
percent rally since August on hopes for new Fed stimulus.
A Reuters poll showed chances are increasing that the Fed
will act on Thursday to energize a U.S. economy that is
struggling to gain momentum in the face of a lackluster labor
market and uncertain fiscal policy.
Spot gold inched up 6 cents to $1,731.34 an ounce,
sharply below a session high of $1,746.20, which marked its
loftiest level since Feb. 29.
U.S. COMEX December futures settled down $1.20 at
$1,733.70 an ounce, with volume heavier than usual, about 25
percent above its 30-day average.
Silver was down 0.8 percent at $33.22 an ounce. It
has gained more than 9 percent in the last nine sessions.
"There isn't enough physical demand to sustain prices above
$30, both from investors and fabricators," said Erica Rannestad,
precious metals analyst at CPM Group.
2:10 PM EDT LAST/ NET PCT LOW HIGH CURRENT
SETTLE CHNG CHNG VOL
US Gold DEC 1733.70 -1.20 -0.1 1727.30 1749.50 148,882
US Silver DEC 33.292 -0.274 -0.8 32.510 34.145 62,570
US Plat OCT 1649.60 42.60 2.7 1603.50 1659.50 16,200
US Pall DEC 679.30 4.40 0.7 665.45 683.35 4,314
Gold 1731.66 0.02 0.0 1726.20 1746.20
Silver 33.220 -0.270 -0.8 32.500 34.080
Platinum 1644.74 45.34 2.8 1606.00 1654.49
Palladium 676.47 10.97 1.6 668.27 680.50
TOTAL MARKET VOLUME 30-D ATM VOLATILITY
CURRENT 30D AVG 250D AVG CURRENT CHG
US Gold 163,287 133,317 196,124 19.44 0.30
US Silver 68,742 53,493 58,222 28.75 0.54
US Platinum 18,389 16,407 8,943 23 0.00
US Palladium 4,326 7,662 4,385
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