“Global uncertainty continues to drive safe-haven demand, supporting gold prices and driving it to fresh six-year highs and one Citigroup analyst says the yellow metal still has room to move higher.
In a recent research note, Shyam Devani, senior technical strategist at Citigroup, said that the ratio between gold and the S&P 500 is testing a critical pivot point and a break higher could trigger a rally that pushes gold prices 25% higher. Devani’s estimate would push gold prices to nearly $2,000 an ounce.
“Equity markets continue to look vulnerable, especially given the deeper inversion of the U.S. yield curve,” the Citigroup analyst said. “Sometimes the ratio between asset classes is too hot. Sometimes too cold. But sometimes the chart signals ‘Just right’.”
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