Gold futures on Thursday aimed for a sixth-straight session gain, but Citibank strategists warned that fresh momentum for the precious metal may not last beyond winter.

“Should gold prices hold near $1,850/oz this week, new investor inflows are likely to materialize and $1,900/oz could be the next upside target,” said a team of Citi strategists led by Aakash Doshi, in a note to clients late Wednesday.

However, a stronger U.S. dollar and more aggressive Fed pricing in short-term interest rates markets are “headwinds for gold price cheer, even if the inflation impulse looks robust,” said Doshi.

Read: Why surging U.S. inflation has gold bulls looking for record highs

Gold for December delivery
GCZ21,
+0.90%

GC00,
+0.90%

rose $16.10, or 0.9%, to $1,864.40 an ounce, with the most-active contract headed for another settlement at the highest since mid-June.

On Wednesday, gold climbed 1%, finding support on the heels of a 0.9% jump in consumer-prices index, which came in well above the 0.6% that economists expected. Annually, inflation climbed to 6.2%, the biggest jump in over 31 years. There is no economic data scheduled for Thursday due to the Veterans Day holiday.

“Concerns about more persistent inflation or even the potential for stagflation is buttressing inflation hedge demand for TIPS, gold, and crypto, which could continue thematically in the short-term as November CPI should keep showing underlying strength,” said Citi’s Doshi and the team.

Gold’s gains coincided with a strong dollar, a move that continued on Thursday. The dollar, as gauged by the ICE U.S. Dollar Index 
DXY,
+0.18%
,
 rose 0.2% to 95.053. Dollar strength often weighs on prices for dollar-denominated assets.

David Russell, director of marketing at GoldCore, told MarketWatch that the rally in gold is actually “still in the very early stages.” He believes the gold market could “stall out before another significantly higher price move.

If the 50-day moving average for gold prices moves above the 200-day moving average, that would be among the milestones likely to confirm the rally, he said. December gold’s 200-day MA is at $1,795.75, while the 50-day MA is at $1,783.32 on Thursday, according to FactSet data.

Meanwhile, Citi lifted its zero- to three-month gold price target by 11% to $1,900 an ounce and its fourth-quarter forecast to $1,800 an ounce from $1,700. But while Doshi said they have priced in a “fat-tail risk” for the commodity to post fresh nominal highs above $2,100 an ounce next year, their base case is bearish for the second half of 2022 through 2023. They expect the Fed will signal a quicker pace of taper at the December FOMC.

December silver prices
SI00,
+2.11%

SIZ21,
+2.11%

climbed alongside gold, rising 47.3 cents, or 1.9%, to $25.245 an ounce, after settling Wednesday at the highest since early September.

Among other metals, December copper 
HGZ21,
+2.23%

rose 2.3% to $4.422 a pound. January platinum
PLF22,
+1.62%

 added 1.4% to $1,092.40 an ounce and December palladium 
PAZ21,
+1.53%

rose 1.7% to $2,073 an ounce.

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