(Kitco News) – Gold has the same positive potential as natural gas before its manifestation earlier this year, told Bloomberg Intelligence (BI), and added that "top dollar" is crucial to the potential rally gold.
"Indications of precious metals, particularly gold, offer setup that is similar to natural gas before its big rally", the directors & # 39; high commodity BI Mike McGlone said in its updated outlook & # 39; December. "Linked & # 39; ranges & # 39; trade historically compressed b & # 39; many factors & # 39; typical pressure approaching extremes & # 39; years, precious metals appear near maximum loss & # 39 ; faith vs. the stock market b & # 39; his health and green claims. "
McGlone stressed only similarity between the gold holding and natural gas, which increased in & # 39; November on supply concerns in the United States.
"Much like natural gas earlier this year, gold has drivers in place to mature from its compressed range. Increasing inflation and debt levels are positive friends, as it divergent strength of gold to the dollar ", he said.
The idea of topping rally of the US dollar is in the center of the BI bullish outlook for gold prices, the statement noted.
"Normalization overdue markets of equity assets and crude oil, and subsequent reduction of expectations of the rate of the Federal Reserve, indicating that run & # 39; dollar is f & # 39 ; elevated risk ending, "McGlone wrote Friday. "The average risk & # 39; reversion in the dollar broadly & # 39; weighted by trading near the highest levels of 2002 and 2016 can overcome most potential & # 39; appreciation."
Gold is "good rally", described McGlone, stating that the Federal Reserve tightening monetary policy can & # 39; is almost the end of next year.
"The narrower range & # 39; 24 months & # 39; Bollinger for a longer period of & # 39; 16 years indicates the metal head," said the journalist.
In addition, gold showed divergent health in light of & # 39; top dollar, the increased returns.
"The best artist, gold, decreased by & # 39; 6% over the place but typically much less in & # 39; these background. As the dollar broadly & # 39; b & # 39; weight differentiated for trade, the beta gold is minus 1.7 on a yearly basis & # 39; 20 years. Class & # 39; major axis & # 39; high performance this year, an increase of & # 39; 8 % in dollar-denominated gold is usually equivalent to at & # 39; dollars worth around 14%. "
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