Gold be headed for a huge move higher, indeed a parabolic move, says investment guru Dennis Gartman.
“The trend is still upward. I continue to be bullish on gold,” The Gartman Letter publisher told CNBC.
Currency weakness is one reason.
The lack of resolve shown at the Group of 20 Nations meeting and confusion over what regulations will emerge from the U.S. financial reform bill also will boost gold, Gartman says.
“I hesitate talking about parabolic moves. But when you compare this period to other periods of time in the past, that’s what well may happen,” he said.
And what constitutes a parabolic move?
“The market starts slowly and takes several years to build,” Gartman said.
“Then, in the last 10 percent of the time frame you get 50 percent of the price movement. I've seen it time after time in 35 years of doing this. And I get the sense that gold is about to do that same thing."
Main Street hasn’t even gotten fully involved in the gold run yet, Gartman says. It’s mostly been institutional investors fueling the rally above $1,260 an ounce.
Some experts say gold has turned into a bubble. Macquarie Bank interest rate strategist Rory Robertson is one of them, but that doesn’t mean it’s headed down yet, he wrote in a research note.
''It is the very nature of bubbles that drives prices well beyond what most observers see as reasonable.”
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