Gold Firms on Weaker Dollar and Stocks, More Converts to Bullish Scenario

Gold jumped back to the high end of the range, buoyed by a weaker dollar and stocks. While the yellow metal back-tracked somewhat before and after the PM London fix, the underlying trend is still perceived to be bullish.

Gold is also gaining support from a raft of notable bullish projections over the past week:

Murray Gunn, HSBC's head of technical analysis: "With momentum turning up we open a long position at a spot reference of $1,260. A stop-loss is set at $1,200 with an initial target of $1,500." - via BusinessInsider

Druckenmiller: Get out of the stock market, own gold - via CNBC

Billionaire hedge fund manager Paul Singer said that gold’s best quarter in 30 years is probably just the beginning of a rebound as global investors — including Stan Druckenmiller — weigh the ramifications of unprecedented monetary easing on inflation. - via Bloomberg

Goldman raises gold price forecasts on weaker greenback - via CNBC

Gold has entered a new bull market: JPMorgan - via CNBC

Confirmation that the world's central banks continued to buy gold in Q1, along with expectations that official demand will continue adds additional credence to the dominant uptrend. World Gold Council data showed that central bank gold demand rose 28% y/y in the first three months of the year to 45 tonnes.

Going forward, Capital Economics thinks that “the upbeat Q1 figure is in line with our view that the official sector will continue to be a steady source of demand for gold, helping to underpin our positive view on prices.” - via BusinessInsider

Bullish prognostications are all well and good, but the underlying fundamentals cited for this optimism are more telling. Persistent growth and negative price risks despite years of unprecedented monetary easing is probably the top reason. Perhaps it's not surprising at all that more bullish gold projections are coming out amid weaker global growth forecasts. That's going to keep the world's central banks pushing on that policy string . . .