Is now the time to get back into gold?

Gold is on pace for its best month since February, rising nearly 2 percent in July as the U.S. dollar weakens. And some strategists are forecasting further upside for the asset typically seen as a safe-haven play.

Gold futures rose in Friday trading to a six-week high of $1,276.60 per troy ounce, extending the gains it made Thursday following weaker-than-expected inflation data and a second-quarter gross domestic product reading that was in line with expectations.

In a technical sign of strength, gold is now trading well above its 50- and 200-day moving averages.

"We see a little bit of a wake-up in risk," said Max Wolff, market strategist at 55 Institutional, who believes the yellow metal will see more of a bid going forward.

"This particular runup may be short-lived, but the long-term trend in gold is probably positive," he said Thursday on CNBC's "Trading Nation." "I think risk is rising, and I think the sort of risk-free double down on risk assets period is probably over."

On Thursday, DoubleLine Capital CEO Jeffrey Gundlach told Reuters that he has exposure to gold, and forecast that gold would rise as "gold looks cheap compared to markets that have rallied a lot, including bitcoin and including Amazon."

In a note to clients Friday morning, Rhino Trading Partners chief strategist Michael Block wrote about the influential investor's outlook on gold.

"Jeff was also talking about how gold is coiling — I agree and think it could be a flight to safety play — enough so that we are long a couple of precious metals stocks," he wrote.

Gold was trading slightly higher on Friday, at $1,268.70 per troy ounce. The yellow metal has "a lot to go on the upside" if relative weakness in the U.S. dollar persists, wrote Pete Boockvar, chief market analyst at The Lindsey Group. In a note to clients Friday morning he pointed out that speculators' net long positions in gold are at the lowest in 18 months.

On the other hand, the activity in gold may simply be an "anti-dollar play," said Boris Schlossberg of BK Asset Management.

"The dollar getting weaker makes gold stronger. If we get any kind of juice out of the U.S. economy, and any kind of positivity on the Fed raising rates, I think gold deflates just as it has over the last couple of years," Schlossberg said Thursday on "Trading Nation."

"So I'm not really an all-out bull on gold at all," he said. "I'm neutral on it at this point, mainly because I really don't know if we do get any kind of rally in the dollar."

Indeed, as the dollar loses value, it tends to cost more dollars to buy the same amount of gold — so the two assets enjoy a strong inverse correlation. Since Fed rate hikes tend to help the dollar, they should tend to hurt gold.

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Trading Nation is a multimedia financial news program that shows investors and traders how to use the news of the day to their advantage. This is where experts from across the financial world – including macro strategists, technical analysts, stock-pickers, and traders who specialize in options, currencies, and fixed income – come together to find the best ways to capitalize on recent developments in the market. Trading Nation: Where headlines become opportunities.

Michael Santoli

Michael Santoli joined CNBC in October 2015 as a Senior Markets Commentator, based at the network's Global Headquarters in Englewood Cliffs, N.J.  Santoli brings his extensive markets expertise to CNBC's Business Day programming, with a regular appearance on CNBC's “Closing Bell (M-F, 3PM-5PM ET).   In addition, he contributes to CNBCand CNBC PRO, writing regular articles and creating original digital videos.

Previously, Santoli was a Senior Columnist at Yahoo Finance, where he wrote analysis and commentary on the stock market, corporate news and the economy. He also appeared on Yahoo Finance video programs, where he offered insights on the most important business stories of the day, and was a regular contributor to CNBC and other networks.

Follow Michael Santoli on Twitter @michaelsantoli

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