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(Kitco News) – The gold market is starting a solid new week with modest gains after a gain of nearly 4% last week.
Gold price for December term last traded at 1,955.40 USD / ounce, up 0.19% during the day.
The modest gains in gold after the market opened on Sunday night came as Democratic candidate Joe Biden went on to secure his presidency. Although some states have not announced their official votes from last week̵7;s elections, Biden has secured enough votes to win the White House race, according to media reports.
Although Biden continues to consolidate his position in history, winning the most votes for any US president, many political experts expect the next few weeks to be full of uncertainty as President Donald Trump is given the is not going to give up without fighting. He has sued in various states to try to change the outcome.
According to many commodity analysts, two factors will continue to support gold prices. First, a Biden presidency – even as Congress is split as Republicans seek to control the Senate and Democrats hold the House – is expected to lead to more stimulus. than. The second factor is ongoing political instability that will drive up gold’s need for safe haven.
Both of these factors will also continue to weigh on the US dollar as it fluctuates near a two-month low. Analysts have said that the US dollar will be essential for gold’s future path, higher or lower.
“With recounts and lawsuits, it could take us a few more months to figure out who will be the next president. That I think will weigh on the dollar. Because there’s too much uncertainty. In the US, I think you have to have gold, ”Darin Newsom, president of Darin Newsom Analysis, said in a recent interview with Kitco News.
In addition to politics, many analysts also expect economic uncertainty to weigh on the dollar and provide new support for gold. This past week saw new records of COVD-19 infections in the US, more than 10 million people across the country were infected, and health officials said it would only get worse.
Many analysts and economists believe that the pandemic will weigh on economic growth when the new year enters the year.
Ole Hansen says that with the political stalemate expected on Capitol Hill, markets will begin to expect the Fed to gain more leadership over the economy.
“Any new stimulus measures from the Fed will make gold prices go higher,” he said. “This seems to be a catalyst that could push gold prices up to $ 2,000 / ounce by the end of the year.
Not only did analysts notice strong fundamental support for gold, but the market made important technical moves as the price held close to six-week highs.
Marc Chandler, chief executive officer at Bannockburn Global Forex, says that gold has broken above the downtrend line significantly; however, he added that the push back to all-time highs is still a hint.
“[Gold is] Not completely different from the race and the recall is $ 2000. It must first break through the $ 1962 zone, which is half a mark of the decline from the record highs of early August and then the pullback (61.8%) near $ 1989.
Analysts at Murenbeeld & Associates say the absence of a green wave in the US election has changed some of the bullish expectations for gold prices in the new year.
“The election results are yet to be determined in the background, but for now, we expect a smaller financial package some (possibly even the Fed) had hoped for, and we expected to Increased pressure on the Fed to review further currency options in analysts said in the company’s weekly report.
The company says it sees the end of the year gold prices in the range between 1,960 and 1,980 dollars an ounce.
Disclaimer: The views expressed in this article are those of the author and may not reflect the views of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, Kitco Metals Inc. and authors cannot guarantee such accuracy. This article is for informational purposes only. It is not an invitation to exchange any commodities, stocks or other financial instruments. Kitco Metals Inc. and the author of this article does not accept responsibility for damages and / or damages arising from the use of this publication.