I think the question is not, “how high can gold go?” but “how low can the dollar go?” The answer is theoretically to zero, so the nominal $ value attached to gold is meaningless.

Bernanke announced in early August that he was going to keep interest rates at a very low rate for two years. You can’t just say the words. The only way the central bank can do that is to intervene in the market and force interest rates down. Just look at the Fed’s unadjusted numbers since the beginning of August and you will see they shot up at the same time.

Its all about relative supply curves – the supply curve for bullion is far more inelastic than is the case for paper currency. Its really that simple.