(Kitco News) – Gold remains range-bound but may be “coiling ahead of a breakout” to the upside, said TD Securities. The Comex August futures threatened the $1,750-an-ounce area overnight before pulling back, trading down $6 for the day to $1,729.60 as of 9:21 a.m. EDT. For some time now, analysts with numerous banks have been forecasting higher prices in the long term due to massive monetary accommodation and stimulus around the world. “Gold once again failed to break through $1750/oz resistance, but taking a step back, it is still clear that prices remain range-bound near multi-year highs,” TDS said. “We believe the market is coiling ahead of a breakout to higher prices — a historical pattern that we have observed several times over the course of the last few years. Ultimately, the key question for gold bugs is whether we are on the cusp of a regime shift in inflation, as the combination of world-war era fiscal and central bank stimulus, along with a change in the central-bank template (symmetric inflation target) and unwinding globalization could lead to a world where inflation is once again very relevant. In this context, a continued growth normalization should be welcomed by gold bugs as a reversal in safe-haven flows should be offset by investment demand, with real rates significantly suppressed.”

Author: Allen Sykora

Source: Kitco: TDS: gold ‘coiling ahead of a breakout to higher prices’

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