Gold prices are set to rise next week.Bundesbank
Gold prices are set to rise further next week, supported by the likelihood of renewed physical demand and by the ongoing geopolitical tensions in the Ukraine.
As many as 11 of 18 analysts polled in a Kitco Gold Survey said they expected gold prices to rise next week, while five predicted that prices would drop and two forecast prices to remain unchanged.
Kevin Grady, president of Phoenix Futures and Options, said: "I am slightly bullish for next week. Gold has held its old resistance level of $1,277 -- now support -- perfectly. The key for me, however, is that the gold forward rates have gone into backwardation. This basically is telling us that the price sensitive physical buyers have once again entered the market."
"The $1,270 support level is still a pivotal number for us; however, it is important to note that we have seen a tremendous amount of liquidation from the longs this past week so I would anticipate less sell stops upon a breach of that support level," Grady added.
Adrian Day, president and chief executive officer of Adrian Day Asset Management, said: "A correction was overdue, given the geopolitical premium in the price in early March, but now the correction has run its course
"[US Federal Reserve chief Janet] Yellen's comments were misunderstood, and Yellen herself has backtracked. Gold is due for a rally."
Richard Baker, editor, Eureka Miner's Market Report said: "Reduced anxiety about Federal Reserve tightening and simmering geo-political tensions in the Ukraine should support a further advance for the yellow metal.
"My gold target for next week is therefore up, likely stalling at $1,320 per ounce technical resistance."
Gold Ends Higher
US gold futures for delivery in June finished 1.5% higher at $1,303.50 an ounce on 4 April.
Prices gained 0.7% for the week as a whole.
Earlier, spot gold rose as much as 1.4% to a session high of $1,306.50.
4 April's gains helped prevent a third consecutive week of losses.
Friday's gains followed a slightly downbeat US labour market report. However, a stable US dollar, higher equities and indications that the world's leading economy remains on the growth path restricted the rally in prices.
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