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Why gold is setting up for a vicious rally

Talking Numbers

Gold is at its highest price in more than six months thanks to economic and political uncertainty in places like Argentina, Venezuela, Turkey, and, of course, Ukraine.

Meanwhile, the Federal Reserve Bank's Open Market Committee (FOMC) meets Wednesday to discuss further tapering of its monetary stimulus program.

(Read: Gold breaks 5-day winning streak; ends around $1,373)

Though gold was down Monday for the first time in over a week, will the overall rally in gold continue?

"In fact, it is sustainable," says Talking Numbers contributor Richard Ross, Global Technical Strategist at Auerbach Grayson. "We've been very bullish here on the US, but we're seeing things are getting a little dicey out there from a global standpoint. Emerging markets are on the ropes right now. You're seeing what's going on in Russia. Even in Europe, the momentum is slowing. All of that continues to favor gold."

Ross notes that gold has broken above its 200-day moving average and is headed towards resistance not far above its Monday settlement price of $1,392.60 per ounce.

"I think the next stop if $1,420," says Ross, who sees the yellow metal potentially making its way to $1,560 per ounce. "Clearly, you want to be a buyer down here and a seller higher later."

(See: CNBC's Commodities coverage)

CNBC contributor Andrew Busch, editor and publisher of The Busch Update, believes gold can indeed get close to Ross' initial target of $1,420 but Busch doesn't see it going much higher. It will depend on what happens at the FOMC meeting, he thinks.

"We'll get some information on that Wednesday," says Busch. "We'll get Janet Yellen to talk. It's really going to be what she says moving forward and what kind of forward guidance they give us for interest rates because the Fed is going to stay tapering and that will hurt gold overall."

"I think we can get up to about $1,425 but I'd love to start shorting it there."

To see the full discussion on what's next for gold with Ross on the technicals and Busch on the fundamentals, watch the video above.

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