In a preview chartbook to their annual "In Gold We Trust" report, Incrementum duo Ronald-Peter Stöferle and Mark J Valek said despite the gold price rally that started in August, sentiment was still bearish.

In US dollars, gold has risen from $1,174 an ounce in mid-August to $1,352.50/oz in March and last traded above $1,318/oz.

"We think the strong move in precious metals since August 2018 is the proverbial ‘canary in the coal mine' for a weaker USD environment, a rise in commodities, and ultimately increasing price inflation," they said.

Year-to-date, the pair said gold was up in almost every major currency and near all-time highs in many including in Australian and Canadian dollar terms.

"Mining stocks are in the beginning of a new bull market," they said.

The duo believe the mega-merger between Barrick and Randgold might have marked the bottom.

"Creative destruction has taken place, and leverage on a rising gold price is higher than ever," they said.

The preview said a "monetary U-turn" was on its way, meaning "we might already be in a prerecession phase" and estimating a 25% chance of a recession within the next 12 months.

"Consequently, crisis-proof assets will probably be in greater demand again in the coming months," the chartbook said.

It also pointed to a turning tide in global monetary architecture, saying "de-dollarisation" was making headlines and noting the US-dollar centric order was not carved in stone.

"Gold and silver mining stocks are probably one of the most hated asset classes these days," the duo stated.

"We are convinced that the capitulation selling of the last couple of years now offers investors a very skewed risk/reward-profile."

The full report will be released on May 28.