Gold analysts are predicting a stable gold price in coming weeks, so long as Middle East tensions do not escalate.
“The unwinding of the hefty security premium slapped on the traditional safe haven asset is likely to continue as the [Middle East] situation seems to be stabilizing,” said today’s daily note from Standard Bank in London.
Matthew Turner, an analyst at consultancy Virtual Metals, agrees that the lack of escalation in the Middle East conflict between Israel and Hezbollah, a Lebanese Islamist political movement, is likely to have been a factor in the recent gold price surge.
South Lebanon battle and your gold IRA – How will the prices move?
Over the past two weeks, Hizbollah guerillas and Israeli forces have been in engaged in battle in South Lebanon.
US based precious metals consultancy, CPM says that one of gold’s attractions as an investment are its Safe Haven qualities. “One of the single most important factors behind the sharp increase in gold prices from 1978 to 1980 was the freezing of Soviet and Iranian assets by the European, Japanese, and US governments,” says CPM.
The recent conflict sparked fears that other countries in the Middle East, with its massive oil reserves, would join the conflict, but the lack of support for either group, and calls for a ceasefire from the world’s major governments has defused fears, and thus the gold price – what does all this mean for your gold IRA account?
Already higher off a large $185/oz correction from May to early June, the gold price carried on going up, and eventually peaked over $664/oz on July 14. Since then it has been in somewhat of a free fall, currently trading at little over $612/oz.
Physical buying could underpin current prices in gold, according to business-standard.com in India, which says that festive buying in India, the world’s biggest consumer of gold, is likely to lend support to gold in coming weeks. Are the top gold IRA companies on top of the current
Turner expects gold to keep with history and remain stable over the rest of the Northern Hemisphere summer, before making moves again in September. He cites the current trading mark of one to six months gold options in New York, at $1100/oz to $1450/oz range, as further evidence of price stability in coming weeks.
Standard Bank, meanwhile, points to a technical support band at the $1200/oz to $1400/oz level.