NEW YORK (Kitco News) - Gold hit a 12-month high above $1,260 an ounce on Thursday as a spooked world marketplace prompted safe-haven demand for the metal.
Analysts are suggesting that on a near-term technical basis, the recent price action has been very impressive and significantly bullish. "Gold prices peaked at $1,900 per ounce in September 2011. It was the end of a spectacular, decade-long bull market, during which the precious metal's value increased a phenomenal 645 percent," explained Frank Holmes, CEO of U.S. Global Investors.
"Since then, gold has struggled to regain momentum as an ever-climbing stock market has drawn more and more affection from investors. But, after posting three straight years of losses, it looks ready to shake off this trend," he said in an interview with Kitco News.
The selloff in world stock markets sent investors and traders scrambling into the once-again-perceived safe-haven gold market. The Stoxx Europe 600 index was down nearly 4% Thursday. Hong Kong's Hang Seng index was also down around 4% on the day. China and Japan markets were closed Thursday for holidays. This led gold prices to extend its winning streak climbing more than 18% since early January. April Comex gold settled at $1,247.80 an ounce while March Comex silver settled the day up at $15.794 an ounce.
Holmes said that not only is the metal trading at 12-month highs, it's also on course for its longest winning streak since the glory days of 2011. He reminded investors that just a short while ago, some gold market watchers were proclaiming the yellow metal had forever lost its safe-haven allure. As it appears to have turned out, those proclamations were just a part of the psychology of the marketplace, he said.