GoldCore Forecasts Rise To New Record Highs

The basis behind that forecast, summarized in a Bloomberg article webbed by Business Week, is contingent upon gold rising above the January high of $1,160 and staying there. The basis for the forecast is gold strengthening despite U.S. dollar strength, indicating underlying demand is rising:

Gold’s rebound from a three-month low the past month “could signify the end of the recent correction, especially as it has coincided with a period of strength for the dollar versus the euro and sterling,” said Mark O’Byrne, executive director of GoldCore in Dublin. “There definitely appears to be a trend for higher gold prices forming.”

In other words, he sees a little more than bargain-hunting behind the support and uptrend. He doesn't mention inflation, but the inflation bogey would (in this economic clime) give an upward kick to the gold market.