The story was made today when the price of gold closed near the highest daily level since August 22, 2011. In fact, as of 5:50 PM EDT, the most active August contracts are currently set at approximately $ 1900.30. On a weekly chart, gold closed at a new record price for the highest weekly close.
Considering that this massive recovery began in mid-March in response to an epidemic that turned into a global pandemic with gold trading at approximately $ 1,450 an ounce. In this short four-month period, traders have witnessed a dramatic rise in gold prices from the mid-March lows to close today at $ 1900 cents.
The global pandemic has affected every country in the world. According to John Hopkins University, the total number of reported cases worldwide is now 15,628,936, resulting in the loss of 636,262 lives.
According to the CDC, in the US alone, 72,219 new cases of the Covid-19 virus were reported the previous day, bringing the total number of infected individuals in the United States to more than 4 million (4,024,492) individuals. Bring the total number of lives lost in the United States to 143,868 with 1,113 new deaths reported today.
Our problems with China did not start with the Covid-19 virus, which is believed to have started in a province of Wuhan. Before the pandemic, our two superpowers were completely engulfed in a trade war. The recovery that started in March this year came after trade tensions between the United States and China had already raised the price of gold.
At the end of 2019, gold was trading somewhere around $ 1,300 an ounce after rising from about $ 1,040 when the multi-year correction concluded in late 2015. Approximately 2 years later, the United States and China would begin trade negotiations that resulted in a trade war.
According to Reuters, it was on September 24, 2018 that 10% tariffs on the value of $ 200 billion of Chinese imports were updated and applied, and on the first day of 2019, China responded by taxing $ 60 billion of goods. Americans. Without knowing it, this problem would be in the background since the world’s largest superpowers were unable to overcome a phase 1 agreement, which at this time has not yet been resolved.
The current focus in the United States and around the world is to mitigate the damage caused by the coronavirus. This has been a huge component that has created a bullish market sentiment for gold. Recent tensions between our two superpowers have intensified the conflict and was the final push needed to bring gold to $ 1900.
Every time this pandemic begins to subside, countries around the world will have to deal with the economic consequences that will surely follow. If the economic consequences are combined with increased tensions between the United States and China collectively, these fundamental problems could drive gold to $ 2,000 or more.
For those who want more information about our services, simply use this link.
Wishing you good trade and good health as always,
Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a request to make any exchange in products, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept guilt for loss and / or damage resulting from the use of this publication.
.
