Gold attracted the attention of most global investors lately because it acts as a safe investment in times of geopolitical uncertainty. Physical gold at the time this report was drafted was trading at $1,808 per ounce, as the safe-haven bullion tracker gained 0.52%.
The world’s largest consumer for spot gold (China) lately have been outperforming the world’s largest economy (U.S) at the macro level, thereby boosting the purchasing power of many Chinese gold consumers into buying more physical gold, and such bullish run could see gold hitting above the $1,900 per ounce level before the end of Q3, 2020.
“The uncertainty related to the continued increase in the virus count is adding some underlying support to the market…There’s absolutely no reason not to hold on to long positions for at least as long as we stay above the $1,765 area,” said Saxo Bank analyst Ole Hansen.
In addition, gold traders have been piling into safe assets as they observe COVID-19 pandemic resurgence accelerating in major global economies.
US-China rising tensions had supported the price of gold staying above the $1800 level helping the yellow metal rise significantly.
Just recently President Donald Trump stated that he was not thinking of negotiating with the Sino leadership on a “Phase 2” trade.
The U.S President also added that the relations between the U.S and China had deteriorated due to the COVID-19 pandemic and many other economic issues such as trade.
Meanwhile, the Gold spot price is presently trading above the $1,800 support levels despite the rally in global stocks lately. This affirms gold traders and investors’ huge appetite for the precious metal as the market remains in a parabolic phase.
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