Is gold a bubble in the making

Abstract

Through this study, we find that Gold Price rise has been led by both Fundamentals and speculation and tried to quantify both the components. For the reasons discussed above, the group believes that the Gold Price level in July 2011 is the new support level taking all macro as well as micro phenomenon into account since the level was sustained for three months and then rose on news of uncertainty created by US Congress debating increasing its debt limits. Since then Gold prices have been on an upward spiral. The news of S&P downgrading the US Treasury securities has brought a sense of certainty in the economy and Gold prices have fallen in the past few days the group believes that this fall in Gold price will be sustained, Ceteris Paribus and will come to maintain at $1500-$1550 per ounce levels.