1. Economic stability
Gold prices tend to rise most when the economy is bad and fall most when things are good, since the economic downturn has been in reversal mode in last few months, Gold prices shall be affected in this respect.
2. US dollar strengthening
One reason gold is so popular right now is many investors see it as a hedge against a falling dollar. Currently US dollar has started picking up, rising against currencies that have suffered because of the severe debt crisis in Europe. A rising dollar usually results in decreased demand for gold
3. Mass investments
When each and everybody invests in GOLD, leaving a high level of speculations which could quickly develop into a selling panic like the bursting of the tech bubble a decade ago.
4.Soaring Interest Rates
With the ever increasing interest rate trend, all investments will suffer including GOLD.
A decade ago, people who invested in GOLD could have churned quite a huge return. The bottom line for any investments is - No one can predict the future!.
Always try and diversify your risks by ensuring a uniform dependency/ concentration in various investment options.
You may refer to the following websites for forcaste details of GOLD pricing
- http://www.easygoldinvestment.com/gold-price-trend-forecast-2011.html
- http://www.goldbullionpro.com/10-reasons-why-investment-in-gold-is-at-its-peak-these-days/
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