Analysts at Nomura Securities have turned bullish on gold, as they see the factors that sparked the metal's 28 percent plunge last year fading.

In a report obtained by Barron's, the analysts, led by Tyler Broda, predict gold will trade at $1,335 an ounce this year and $1,460 next year, up from $1,138 and $1,200 previously.

April gold futures traded at $1,338.90 on the Comex around midday Wednesday, after hitting a four-month high Monday.

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"Like a phoenix regenerating from its ashes, cyclical gold appears set to recover," they wrote.

The analysts say that exchange-traded fund (ETF) holders and hedge funds are no longer unloading gold. Gold producers have ditched new projects in light of last year's price drop, and real interest rates are steady.

After last year's slide "many of the variables that drive gold prices have already reset to an extent," the analysts wrote.

"ETF and Comex positioning no longer appear to pose the same threat to prices as in 2013. Gold producers have delayed the next phase of growth projects as they work to protect balance sheets."

Rising incomes in Asia should boost long-term demand there, the analysts say. They expect gold prices to increase over the next three years.

Gold is benefiting from the turmoil in Ukraine, but not everyone thinks its strength will last.

"Short term, the uncertainty’s still here, and gold fulfills its purpose as an insurance asset and as a diversifier,” Dominic Schnider, head of commodities research at UBS, told Bloomberg.

"The medium to long term is still negative for gold as we get more clarity on growth and move toward U.S. monetary policy normalization."

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