Gold has lost much of its shine in the year-to-date period as investors had fewer reasons to be fearful about the global economic outlook. Towards the end of 2016, investors were optimistic about the bullish prospects of gold this year because of how geopolitical concerns could trigger a capital flight towards the safe haven metal. Investors were especially worried that Donald Trump could initiate policies that would trigger an economic crash when he took the Oath of Office on Jan 20.

However, in the last couple of months, it is becoming increasingly obvious to investors that the global economy is resilient. In fact, it appears that it would make more than a couple of ill-timed or hasty economic policies to trigger another global economic meltdown. However, the next couple of weeks could be decisive for the global economy as new geopolitical concerns start to take shape. This piece seeks to see if the bullish case for gold can be revived going forward.

Here’s the bullish case for gold

Investors are still riding the bull on Wall Street and they haven’t started making the capital flight into gold yet. The yellow metals is still trading around $1,283.40 an ounce but it has managed to creep up 8.44% in the year-to-date period as shown in the chart below.

Interestingly, many analysts had provided strong bullish forecasts for gold and it seems that such bullish forecasts have largely fallen flat. However, analysts are optimistic that gold will eventually get back to winning ways as tensions continue to mount. Roberto Jensen, an analyst at Saxon Trade observes that “the bullion doesn’t always make sharp uptrend in the short-term but we can expect a break-out in the medium term as investors start to lose faith in the political class.”

Jurge Kiener, chief investment officer at Swiss Asia Capital also shares the same bullish sentiments. In his words, “from a fundamental point of view, I think we’re going to get a break out on the upside.” Interestingly, the upcoming French elections could open the proverbial Pandora’s Box that could send gold prices skyrocketing.

Geopolitical tensions revive the bullish case for gold

The minor relief that investors had about geopolitical anxiety earlier this year might have ended and there’s mounting apprehensions that. To start with, there’s news making the rounds that Russian planes are moving wing to wing with Syrian planes on the ground. Syria is one of the hottest spots of geopolitical uncertainties in the Middle East and Russia’s intervention suggests that the West might be drawn into a sinkhole of epic proportions.

The kind of “frenemy” relationship between U.S. President Donald Trump and Russia also precipitates uncertainties on how the West might intervene in Syria. Still on Russia, breaking news also indicate that Russian bombers have started making deep maneuvers into the U.S. border zones in Alaska. Russia has been flexing its military muscles in recent times and investors have more reasons to be afraid.

Going forward to Asia, North Korea had made a video showing its missiles annihilating the U.S. The video itself is a threat that the U.S. can’t ordinarily afford to ignore because of Kim Jong-un’s eccentric nature. However, levelheaded U.S. presidents might ignore North Korea’s threat but it is unlikely that Donald Trump will be so forgiving.