Where To Next For Gold?

My latest for Moneyweek:

A number of you have asked for my latest thoughts on gold. In particular, you’ve been asking about my spring target of $1,400 an ounce. So I’d like to take a look at it this morning.

Let’s be honest, in 2010 gold has been a bit of a dog. So have gold shares. Gold began the year at about $1,120 an ounce. Today it sits at around $1,110.

Gold shares, as measured by the index of unhedged gold miners, the HUI, are down some 10%. The HUI began 2010 at just below 450 and now sits barely above 400. The S&P 500, meanwhile, which began the year at around 1,130, now sits a few percent higher at around 1,170.

Worse still, in January’s correction, gold and gold shares were hit harder than the stock market. And in the subsequent bounce, they have been laggards. This is not the action I would like to see. I would prefer some signs of leadership.

So what next? Read on …