A correction in equity markets due to shifting economic growth expectations could be the catalyst to push gold out of its narrow range, according to one market strategist.
In a recent report, Joni Teves, precious metals strategist at UBS, said that although gold is currently stuck in no man’s land, there is potential for prices to push to $1,600 an ounce. The question is, for how long can prices hold that level?
For the short-term, Teves noted that investors shouldn’t ignore gold’s recent resilient strength.
“It is not so much a question of who is buying gold, but also who is selling it,” she said in the report. “While many are not yet keen to chase it here, there is also no appetite to sell short or even let go of strategic positions that have been built. Sentiment is friendly and there is an underlying bias to be long.”
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