A few years ago, analysts suggested that the specter of a Greek exit (GREXIT) from the Eurozone would cause such pressure on the Euro currency that gold prices could have risen to $2000 per ounce and over their all-time highs of just a few years before. But since a Grexit did not take place, and the Greek government capitulated to the Troika, it was a major stumbling block for the metal and allowed central banks to continue the status quo of pumping their fiat currencies and shorting gold to their own record levels.
But things have changed over the past two years, and these include a very close referendum for secession by Scotland, a de-pegging of the Euro by Switzerland, and coming up in the next two weeks is another exit vote for an EU nation which analysts also see as a potential trigger for the next leg of the gold bull run.
By all but ruling out a rate rise in June, this leaves gold in a great position to head up to $1,400 in our opinion. The reason? The Brexit. The vote is just over two weeks away and the latest figures reveal that the vote for leaving has edged ahead by three percentage points. A lot can change between then and now, but if it stays the same way we think that the week leading up to the Brexit vote could be awfully volatile for financial markets across the world. This could lead many to seek safe havens, and what better safe haven to jump into than gold? - Seeking AlphaIn times of turmoil, gold has by far been the most go to asset for stability and protection of wealth. And at stake is more than simply a country looking to remove itself from a coalition that is changing rapidly from a monetary and trade union into a political and social engineering one, but a rejection of the Eurozone concept itself, and the currency created to merge Europe under a single monetary banner.