After hitting its all-time nominal highs in 2011, and following a brief spike higher in 2012, gold prices were in a steady decline until 2016. Since then gold prices have muddled through, with little buyer interest outside of typical metal investors.

“There’s a general circus continuing in Washington and in February we had major gyrations in the stock market,” Lusk says. “I think investors started to say I might not want to be long metals yet, but I definitely don't want to be short. And that’s a bullish sign for gold.”

Trade wars are dollar-negative, says Jim Paulsen, chief investment strategist at The Leuthold Group. While a weak dollar could help export competitiveness, a trade war could increase import prices. “This would further increase inflation pressure, an issue already dominating the market’s attention,” he says. 

Frank Holmes, chief executive officer and chief investment officer at U.S. Global Investors, which also runs the U.S. Global GO GOLD and Precious Metal Miners ETF (GOAU), expects the dollar to stay weaker and support gold, and he sees gold further strengthen this year. He also points to net gold purchases by central banks in 2017, particularly by China and Russia, a trend that could continue.

Although the Federal Reserve raised rates in March and is forecast to do so again later this year, those rate hikes are expected and aren’t likely to tarnish the metal. Gold showed its own mettle in March, rallying after the Fed rate hike.

If the dollar stays weaker and surprises continue to come out of the White House, gold’s role as a safe haven may reestablish itself, which means the traditional situation where equities and gold move in different directions may return. That happened after announcements by the Trump administration of tariffs on China, which torpedoed stocks and lifted gold.

“The price of gold is an economic and political barometer,” Gero says.

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