The price of gold on Tuesday went down to some correction. The main reason for the emerging recession is, on the one hand, though not quite solid, is the strengthening of the greenback, and on the other, the uncertainty regarding the epidemiological situation.
As well observed over the previous trading days, the increase in the number of COVID-19 patients in the world is forcing the precious metal to move up, as well as the fact that the United States of America has again begun to provoke China into a conflict that will never stop and periodically escalates. If not for these facts, gold would not have been able to continue to be kept within $ 1,800 per troy ounce, which is now strategically significant for it.
At the auction, the price of precious metal futures for delivery in August fell by about 0.77%, which led to a decrease to $ 1,800.15 per troy ounce. The reduction will not end there, and even greater losses are expected during the day, which is likely to cause the metal to fall below the defense level of $ 1,800, which is extremely important for it.
The level of support for gold settled at around $ 1,796.50 per troy ounce, and the resistance, in turn, went to the area of 1,825, $ 50 per troy ounce.
According to the established tradition, investors begin to turn to gold at the moment when they feel the danger. Gold, to them, became a safe haven asset amid strong the storms. However, now the situation has developed on the market where it is preferable to use precisely the greenback in order to preserve assets. Nevertheless, it should be noted that from a global point of view, the trend for gold will not lose its relevance for a long time, only occasionally being noted by a slight weakening of interest.
Over the past few weeks, gold has continued to consolidate near the level of $ 1,800 per troy ounce, which indicates stabilization in the precious metal market, which is a fulcrum for further growth. However, for the time being, amid external factors, the precious metal is driven into a narrow corridor, most likely it will take a long time to get out of it. Nevertheless, the support that can make the price of gold much higher has not disappeared and is only waiting in the wings. Some experts believe that growth will resume very soon.
The coronavirus pandemic has not receded anywhere, and in the near future, the situation will only worsen, which will inevitably affect the dollar exchange rate in the direction of its fall. This is the first support factor for precious metals.
The US Federal Reserve will face the need to make the base interest rate higher, which will also make gold rise. This is the second support factor.
In a difficult situation of uncertainty, risks seriously increase, and as you know, not all market participants want to endanger their assets. In this regard, investors will be forced to go into the protective zone, which is the precious metals market. This is the third support factor.
All this can cause gold to jump up to the level of $ 1,900 per troy ounce this year. And in the next, it will be able to storm the level of $ 2,000 per troy ounce. However, it is also possible to prepare for a correction within $ 1,790 per troy ounce.
Silver futures for September delivery rose well on Tuesday gaining 1.67%. Its current level is still kept at around $19.457 per troy ounce.
Copper futures for September delivery also slightly went up by 0.11%, and the price was in the region of $2.9133 per pound.
Palladium, on the contrary, began to cost 0.73% less, which sent it to the level of $ 1,965.44 per ounce.
Platinum supported the negative trend and fell 0.33%, which made it move to the mark of $825.59 per ounce.
