Bank of America backs gold for all-time high this year as precious metal surges

Gold has continued to rise of late as a resurgence of coronavirus cases, particularly in the U.S., has dented some of the investor optimism about the speed of a post-pandemic recovery.

Spot gold edged up slightly to $1,763 per troy ounce by Thursday afternoon in the European trading day, down from the $1,779.06 touched early on Wednesday, its highest since early October 2012.

However, the precious metal is up by around 16% since the start of the year, and analysts see the broad rally continuing as uncertainty abounds over the virus and reemerging global trade tensions.

Bank of America Chief Global FICC Technical Strategist Paul Ciana said the uptrend in gold prices is set to test the 2012 highs of $1,790-1,805/oz in the next week. Should it break through expected resistance at $1,800, bullion will then set its sights on the all-time high of $1,920.70 made in 2011, Ciana said in a note Wednesday.

Ciana suggested that a wave leading gold prices into the $2,000s is already underway, with an upside scenario of $2,114-$2,296.

The U.S. reported a record daily rise in new coronavirus cases on Wednesday, with 45,557 diagnoses, after states reopened their economies in recent weeks.

Compounding fears over a global resurgence of the virus is a flare up of international trade tensions. A notice from the U.S. Trade Representative Tuesday evening revealed that the Trump administration is considering new tariffs of up to 100% on $3.1 billion exports from France, Germany, Spain and the U.K.

Bank of America backs gold for all-time high this year as precious metal surges, CNBC, Jun 25