Brian Price CNBC 23/03/2016
Gold is about to surge to multiyear highs, according to one megabull.
On CNBC’s “Futures Now” on Tuesday, Orips Research CEO and Chief Market Technician Zev Spiro said that a break above key resistance earlier this month could send bullion catapulting as high as $1,450, a level the market hasn’t seen since May 2013.
Gold is up 18 percent in 2016 and is tracking for its best quarter in more than 30 years. A move to $1,450 would represent a 17 percent increase in value from Wednesday’s price of $1,233.60.
Considering the major gains seen in the precious metal over the past several months, Spiro maintained that the best is yet to come for the once beaten down commodity. He pointed to movement of gold on a daily basis and highlighted where the price has broken through a negative trend line that has lasted nearly three years.
“Despite the huge rally already seen in gold, the break above the descending channel signaled higher prices with a minimum expected price objective in the $1,450 area,” the technician added.
Spiro didn’t specify when this level would be reached, but also warned that there could be choppiness ahead of whenever the gain occurs.
“Indicators are generally positive on the daily, weekly and monthly charts. However, current readings are slightly overbought on the weekly chart,” said Spiro, who believes that prices are overextended from the major moving averages. “Therefore, a continued consolidation may occur before [we see] higher prices.”