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Commodity Forecast for Gold — April 2010

April 18, 2010 at 23:47 by Vladimir Vyun

The gold performed well from the beginning of this year. While it hadn’t jumped as much as some experts expected, the metal generally retained its trend to rise, if not with the tremendous pace. The gold stayed above the $1,000 level, but can it conquer new heights?

Nowadays it looks like the gold can be considered more like the alternative currency than the commodity. And, as such, it can benefit from the uncertainty in the currency market and the need of the investors for the safety. The situation with Greece let many believe that Europe has some deep-seated problems, which can’t be resolved in near future, and the bailout, offered to Greece, isn’t the actual solution, but the hasty attempt to do at least anything, which may be futile in the end. Of course, other currencies benefited from the resulting weakness of the euro. The dollar is one of such currencies as it is still considered as the safe haven for the investors. But how long will it last? Some analysts think that the debt problem may hit the U.S. too, weakening the dollar and striping the currency from its importance for the global economy. Many countries, China in particular, are already beginning to sell the dollar and amassing the gold. And the gold may become very attractive as an alternative currency as it’s not that much prone to the inflation as the other currencies.

The physical demand, like the demand from the jewelry industry, was subdued by the growing prices. Yet it may be slowly restoring itself as the customers are becoming accustomed to the new prices. What’s more important, the physical demand may provide the support for the gold prices as the customers will be buying more gold if its price would fall.

Some analysts think that by the end of the year the gold price may reach as much as $2,000. But most don’t support such optimistic outlook, claiming that the precious metal will stay in the current range. But despite some disagreement over the short-to-medium term gold performance, almost all agree that over over the long-term the metal looks bullish.

If you have any questions or comments about the future trading for the Gold, use the form below to reply.

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