London, United Kingdom (PressExposure) December 08, 2009 -- Sources close to analysts at "Zen International" say the firm's assertion that gold would reach $1200 before the end of 2009 appears to be accurate as the precious metal's stellar performance has seen it setting new records almost on a daily basis.
The Asian-based investment boutique is convinced that as investor hopes for some form of signal from the US government or the US Federal Reserve on supporting the dollar fade, gold is assuming its role as the ultimate currency.
Nevertheless, one of the "Zen International" sources said that the firm was advising clients to avoid buying in to gold at its current levels reasoning that the market was due a period of consolidation after a pullback in prices. He added that there was a distinct likelihood that sentiment among investors in equities and other riskier assets could turn sharply if economic data confirmed widely held suspicions that the nascent recovery underway in the US and other nations are based purely on massive fiscal stimulus.
"Zen International" apparently believes that any change of sentiment could see a knee-jerk reaction which would see investors return to the perceived safety of the US dollar. Such an event could see gold sell-off sharply.
"Zen International" has also recommended that clients sell half their holdings in selected junior mining stocks that have doubled in price on the back of the gold price rally suggesting that prices of junior stocks could come off sharply in any flight to safety by investors.