After the record run in gold prices, followed by the subsequent sell-off, exchange traded funds that follow gold prices could be past their prime as one commodities market researcher argues gold has already peaked.
According to the CPM Group, gold prices will remain high but won’t jump above their record highs seen in 2011, reports Lori Spechler for CNBC.
“We reached the cyclical peak later than we thought but by the end of the year the price was down and (gold) has been trading sideways,” Jeff Christian, Founder and Managing Director of the CPM Group, said in the article.
In the company’s “Gold Yearbook 2012,” the report highlights the higher gold supply coupled with a set pool of demand will keep a floor under the market, with prices to remain firm. Consequently, gold prices could begin to consolidate over the next few years.
“We are looking for the price to stay above $1,500 this year and above $1,400 over the next few years,” Christian added.
As global uncertainty wanes, investors have shifted from a “sell the rally” to a “buy the dip” mentality, especially from the safe-haven investments witnessed late last summer.