ANALYSTS have tipped gold to trade around $US1000 per ounce for a while, after coming within a whisker of historic highs.
The precious metal, which is seen as a natural hedge against inflation, has been buoyed in recent weeks, as speculation mounts of a world economic recovery.
At 12.45pm (AEST) the local spot price of gold was $US1000.30, after trading as high at $US1003.
Keith Goode from Eagle Research Advisory says a combination of factors have combined to push up prices of the precious metal.
These included restocking by China, a weaker US dollar, stronger commodity prices, inflation fears, India's monsoonal season and demand from jewellers ahead of Christmas, Mr Goode said.
Stock market bears worried that recent gains are unsustainable may have also played a role in propping up gold.
"I don't see why those prices can't be sustained,'' Mr Goode said.
"If anything it may come off in October.
"This period of the year is usually the best period.''
The all-time high was set on March 17, 2008, when gold traded above $US1030 per ounce before closing in local markets at $US1024.70.
"There is always uncertainty around the outlook for gold prices,'' Mr Moore said.
"The possibility of it flipping around the $US1000 mark, both above and below, in the short term is relatively high.
"It is possible it will go on a bit of run, but on a three or six month period my expectation is that the gold price is likely to be lower,'' he said.
The fragility of the US dollar was a positive for gold, but the metals safe haven status was likely to have reduced impact as the global economic recovery continued.
While the price of gold is trading around historic nominal highs, it is still not close to its peak in real terms.
Commonwealth Bank analysis showed that in today's dollars, gold's 1980 peak saw prices worth more than $US1800 per ounce.
"We do not believe that there is anything magic about particular numbers,'' the analysis said.
The London-based World Gold Council (WGC), run by major gold miners, said current prices were about 21 per cent higher than the September average last year. The WGC said the $US1000 mark was no longer the watershed it once was.
"Investors are turning to gold as they seek assets which preserve their wealth, whatever the financial weather,'' said WGC chief Aram Shishmanian.
Despite the high prices gold stocks were mixed at 12.47pm, with Lihir Gold steady at $30.09, Newcrest up 63 cents to $34.38 and Newmont Mining off 8 cents at $5.38.