In intraday trading today, gold is nicely above the $1,640 an ounce level.

January 12, 2012 – The New Year’s rally has been particularly good to gold, firmly establishing the spot price comfortably above the psychologically important $1,600 an ounce level and taking out the 200 day moving average, the last barrier that had analysts hesitating to call the absolute end of the correction that began in December. Gold didn’t just peak over the 200 day moving average, it tackled the $1,635 an ounce average and kept on going. In intraday trading today, gold is nicely above the $1,640 an ounce level.

Not a bad start for the year, considering two weeks ago some analysts were selling their gold and calling a bear market. Gold is already up $76 in the first eleven days of the year. That’s a 4.8 percent yield in seven trading days. And it looks, as the 200 day moving average was the line in the sand most analysts were watching, like the New Year’s rally will be extending into a protracted bull market rally. Gold has made all the technical moves necessary to indicate strong rises in price in the near term.

In the coming weeks and months, we will see gains on gold that will rival 2011 and possibly the 24 percent gain in 2011. Most banks are already aware of this and are buying gold and advising their clients to buy gold accordingly. The latest report comes from Citi, which projects the price of gold reaching $2,400 an ounce in 2012. That may seem like a stretch now, but Goldman Sachs, Credit Suisse, and Societe Generale are all projecting similar gains and the price of gold in the past 24 months has made greater gains in percentage. It is entirely possible we will see gold breach $2,000 an ounce this year and it may do so by a comfortable margin.

Right now, gold is down 14.7 percent from its all-time high of $1,923 an ounce on September 6, 2011. This makes gold coins a significant buy, as they are currently undervalued in a post-correction market. As the 200 day moving average has been breached and gold is reestablishing is firm upward trend, more and more investors will be reallocating into gold and the price will show in the coming week. Now is a good time to buy gold coins.

Kevin Johnson

Senior Staff Writer –

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