Wall street analysts are remaining bullish on gold despite the "tepid economic recovery." One brokerage is even predicting metal prices to rally as high as $3,000 an ounce by early 2014. A technical analysis done by Bank of America Merrill Lynch forecasts gold could continue to rise at a rate of $25 per month.
By Jennifer Booton
Published September 26, 2012
Wall Street analysts remain bullish on gold amid the tepid economic recovery, with one brokerage predicting the precious metal could rally to as high as $3,000 a troy ounce by early 2014.
Gold dipped to around $1,743 an ounce Wednesday morning, but a technical analysis conducted by Bank of America Merrill Lynch (BAC: 8.96, +0.14, +1.64%) forecasts the safe haven could continue to rise at a rate of $25 a month.
“We remain secular bulls on gold,” BofA analyst Stephen Suttmeier said in a report to clients. “Key chart and uptrend supports between $1,600 and $1,400 have held and we have viewed $1,550-$1,500 as a good area to buy gold.”
Gold prices recently broke above the year-long downtrend line, completing the correction within the longer-term uptrend that targets resistance of $1,800 to $1,925.
The secular bull market for gold points to a stronger rally of $2,050 to $2,300, and up to $3,000 longer term, Suttmeier said in the report.
Often seen as an inflation hedge, gold settled on Tuesday just 6.61% below its record closing high of $1,888.70, which was set in August 2011.
Gold is also up nearly 15% from a 52-week low of $1,536.20.
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