BofA Makes The Case For $3,000 Gold
Everyone loves gold these days. Deutsche Bank sees $2000 gold soon. And Citi says it could go to $2500 in six months.
BofA, too: the firm recently initiated a $2,400 target price for the shiny yellow metal since the Fed’s announcement of open-ended bond buying.However, BofA analyst Stephen Suttmeier thinks there’s a case to be made that gold goes even higher than the bank’s official call.
In a note to clients today, Suttmeier writes:
The secular bull case for Gold $3000
We remain secular bulls on gold. Key chart and uptrend supports between $1600 and $1400 have held and we have viewed $1550-1500 as a good area to buy gold. The breakout above the year-long downtrend line completes the correction within the longer-term uptrend and targets resistances at $1800 and $1925. But, the secular bull market for gold points to a stronger rally to $2050-2300 and up to $3000 longer-term. The top of the rising channel from mid 2005 is near $2375 and reaches the $3000 area by early 2014. Key channel supports are in the $1600 and $1400 areas and rise ~$25/month. The chart above shows the secular bull market for gold.