CitiFx says gold could rise to new high this summer

NEW YORK: Gold could rally to new highs this summer, provided it moves above strong technical resistance near the current trading range, CitiFX said on Friday.

Gold will rise above $2,000 an ounce over time on safe-haven demand due to ongoing financial turmoil, and as massive liquidity injections by governments stir inflation, CitiFX said.

CitiFX said that gold has been in a choppy consolidation after it hit an all-time high of $1,030.80 on March 17, and the current price action was similar to the move after bullion reached a high of $730 an ounce in May 2006.

"As a consequence, we feel that, if we can see a break through good resistance in the $875-890 area, it could open up the way for a move to new highs by this summer," CitiFX analysts said.

On Friday, U.S. gold futures for February delivery jumped above $900 an ounce, powered by strong investment demand spurred by high volatility in the currency markets, dealers said.