The price of gold will rise because of the conflict in Ukraine and declines in the U.S. stock markets, according to
CNBC's weekly sentiment survey.
More than half of the survey's 23 participants, or 57 percent, predict gold will rise this week. Some even say gold could approach $1,400 an ounce. Only 30 percent predict it will fall, and 13 percent say it remain stable.
Spot gold reached a three-week high of $1,329.70 Monday before falling to $1,311 in response to better retail sales and stock prices.
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"Gold is bullish at these levels," Rich Ilczyszyn, senior commodities broker at Chicago-based iiTrader, told CNBC, saying gold could easily retest its high set on March 17.
The Federal Reserve's dovish monetary policy supports the price of the precious metal, gold bulls say.
"The Fed's latest interest rate meetings not only indicate that rates will stay low but that any eventual rise will be tapered, measured and quite gradual," Scott Carter, the chief executive officer of Los Angeles-based Lear Capital, told CNBC. "Clearly gold has been responding to this accommodative tone."
On the other hand, Societe Generale stated the current price offers a good time to sell and a price over $1,300 is "a very good entry level for shorting gold," according to CNBC.
"We would expect the gold price to trade lower on a trend basis this year as the U.S. economic recovery should continue, thereby laying the ground for a less expansionary Fed policy stance and higher real interest rates," Societe Generale's Robin Bhar and Jesper Dannesboe wrote in a recent research report.
Although gold was — surprisingly — under downward pressure in early trading Tuesday, its immediate outlook is strong due to the Ukrainian crisis, stated
Kitco News' Jim Wyckoff.
Even during the height of the eurozone debt crisis a few years ago, prices of the metal occasionally fell, he noted.
"The Russia-Ukraine crisis is the dominant market theme this week. . . . This conflict will remain a major markets-moving factor for at least the rest of this week."
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