MORE BANK analysts cut their gold price forecasts this week after the precious metal suffered its steepest decline in 30 years.
"We find ourselves in the unexpected position of downgrading what had initially been one of the most bearish gold price forecasts in the market," writes Nic Brown at French investment and bullion bank Natixis, cutting his 2013 average from $1625 to $1500 per ounce.
Pointing to "the potentially devastating effect" that gold ETF trust funds could have on prices if professional investors continue to sell, Brown also cuts his 2014 forecast from $1500 to $1320.
"We expect to see higher US bond yields and a firmer US Dollar into 2014," says Mitul Kotecha at French bank Credit Agricole, now forecasting an average gold price of $1480 per ounce this year and $1318 next.
"[That] should maintain the downward pressure on gold prices into next year given the strong influence of both of these variables."
On a technical analysis of the gold price chart, Dhiren Sarin at Barclays Bank calls the last fortnight's sharp rally a "bear flag" – a pattern of quick falls followed by swift bounces which then fade, as seen in January and February 2013 according to Bloomberg News.
Chief technical strategist for the bank's Asia Pacific advisors, Sarin warns that "if [gold] breaks down below $1390, then we can see further downside to $1300."