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Gold to hit $1,780 in 2011

Thursday, January 6, 2011

Gold Bullion will climb as high as $1,780 this year according to MKS Finance SA. Although the price of gold has fallen in recent days on the back of improved economic data, many analysts believe investors will continue to buy precious metals as a protection of wealth.

Prices dropped 2.4 percent yesterday and today swung between a gain of 0.3 percent and a loss of 0.2 percent.

"Gold fell too much yesterday" said Chris Kwon, a trader at KTB Securities Co. in Seoul. "Improving economic data appears to provide just some short-term weakness for gold. Overall, the uptrend remains intact as the U.S. economy is not in a full recovery yet and interest rates remain low."

A short term drop in the price of bullion is clearly an excellent opportunity to take advantage of a longer term increase. 

Gold jumped 30 percent last year after governments spent trillions of dollars and kept interest rates low to bolster economies following the worst global recession since World War II. This year, bullion will average $1,502 an ounce.