NEW YORK ( TheStreet) -- The precious metals rumor mill is in high gear once again. The contradictions are almost tantalizing.
The pantheon of gold gurus has a lot to say about this alluring symbol of wealth. On Friday the 13th (just that date alone can make some skittish) Goldman Sachs' (GS) head of commodities research Jeffrey Currie said in a TV interview that gold is about ready to dip further as the U.S. Federal Reserve withdraws stimulus and economic data improve.
The investment bank suggests there's risk gold bullion may even fall below $1,000 an ounce. Does Currie know something we don't, or is he a part of the 66% of analysts who believe the Fed will start taking its foot off the bond-buying pedal sooner than later?
The debt-ceiling, the Syrian drama and other tempests in a teapot may support gold prices in the short term, Currie said in the interview, but he strongly suggested gold will resume its decline into next year.He went on to say the firm's price target on gold for 2014 is $1,050, and during the ensuing correction the commodity may overshoot to the downside. "While we agree with the mid-cycle price somewhere around $1,200, we believe that at least near term it can overshoot to the downside, which is why we have $1,050" as a target, Currie said. "It clearly could trade below $1,000." Peter Krauth at Money Morning, they may beg to differ. Krauth wrote on Monday that "gold is set to surge." He claims one of the best indicators of the direction of gold's price is the Commodity Futures Trading Commission's Commitment of Traders (COT) report for gold. His premise suggests that the commodity traders tend to move in tandem and that these speculators "...are almost always wrong at extremes." "According to recent COT reports, speculators are so bearish on the gold price, their short positions are 70% higher than they have ever been throughout this 12-year secular gold bull market," Krauth explained.
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