Gold Prices Poised To Surge 13% In 2017

More than two thirds of the analysts and traders surveyed from Singapore to New York have said gold will be bullish in 2017.

The median year-end forecast was $1,300, with the year’s peak seen at $1,350. Two, including O’Byrne, said the metal may reach $1,600.

Gold prices fell about 1.5% in December. But that isn’t stopping many pundits from making bullish forecasts, Nasdaq reports.

Other risk factors that could propel the yellow metal higher in 2017 include a potential trade war between the U.S. and China, tensions with Russia regarding alleged hacking of the DNC, and continued Brexit-fueled turmoil in Europe. From Bloomberg :

While the precious metal has always been hoarded in times of trouble, a bevy of political and economic surprises in 2016 sparked a surge in buying that sent bullion to the first annual gain in four years. Prices may rally about 13 percent in 2017, according to a Bloomberg survey of 26 analysts.

On the bearish side of things, we’ve seen big outflows in gold ETFs since the November election, in a sign that the demand for gold exposure waned considerably into the end of last year. If demand continues to weaken, gold prices will almost certainly follow suit and drop even further.

Despite that clearly negative trend, the majority of analysts are still bullish on gold. The average forecast of a 13% rise would be the largest yearly gain since 2010.

That divergence in price action from sentiment likely means volatility in gold prices and gold ETFs will continue for the foreseeable future.

SPDR Gold Trust (ETF) ( NYSE:GLD ) closed at $109.61 on Friday, down $-0.68 (-0.62%). In 2016, GLD gained 8.03%, versus a 10.78% rise in the benchmark S&P 500 index during the same period.

GLD currently has an ETF Daily News SMART Grade of C (Neutral) , and is ranked #2 of 29 ETFs in the Precious Metals ETFs category.