Gold did something! Or did it?

by Nov 6, 2020Market Reviews

Gold did something! Or did it?

Gold has rallied as the election has slowly been unfolding. Currently, Gold has been hovering at $1,950.  However, is this because it’s a safe haven? Or is it because Gold has a “risk-on” sentiment associated with it? 

Gold may shoot past a key Fib level at $1,958

Gold giant bullish on Gold

Barrick Gold seems to think it’s the former. The company, which Warren Buffet recently invested $600 Million in, recorded an almost threefold rise in third quarter profits. Mark Bristow, President of Barrick Gold stated that Gold’s price would surpass its all-time high. He states “The deep structural damage to the global economy and society at large will be with us for a lot longer, it will be like the second world war crisis,” and that

However, we can see previously that Gold has rallied with equities and that this may be the historical risk-on sentiment pushing Gold higher. Furthermore, the recent drop in the dollar is further pushing Gold higher, as the Chairman of the Federal Reserve Jerome Powell announces that the Fed is going to leave rates as is, citing that the economic outlook is “extraordinarily uncertain” and called the ever-rising cases of the Coronavirus in the United States as “particularly concerning”.

Low-interest rates may boost the price of Gold

Low-interest rates worldwide have benefit house prices, which has helped boost asset prices in that market and keep money switching hands. With Nonfarm payrolls predicting a slight decrease in jobs added in the economy to 600k from 661k, volatility may continue to play out in US Dollar pairs, possibly boosting the price of Gold.

It is currently looking like a win for Biden in terms of the Presidency, which may further boost Gold asset prices on a risk-off episode.

 Are you watching Gold?

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