The prices on the precious metal market does not show any serious changes this morning, but the price of gold is slightly growing indicating the continuation of the upward trend. The reason for being positive remains the same: a new strain of coronavirus infection found in the UK has seriously affected investor sentiment and forced us to pay close attention to more protected assets again. In addition, it became known that the program of financial incentives in the United States of America has been approved for its first part.
The price of gold futures contracts for February delivery on the electronic trading platform in New York rose quite a bit this morning by 0.06% or $ 1.05. Their current value is now $ 1,883.85 per Troy ounce. At the same time, the support level of the metal is equal to $ 1,859 per Troy ounce and the resistance is $ 1,912 per Troy ounce.
The price of silver futures contracts for delivery in March is also rising today, but much more significantly. The morning gain was 0.52%, which moved the price to the level of $ 26,517 per Troy ounce.
On the contrary, the price of copper futures contracts for delivery in March is showing a reduction today, which can not be considered serious. The price has fallen so far by only 0.02%, forcing the metal to move at the level of 3.5798 dollars per pound.
The main stream of the news in which the market participants react so violently continues to come from the UK. It is worth recalling that over the weekend, the country's authorities officially announced that scientists have identified a new mutation of the COVID-19 virus, which in its properties was much more dangerous than the previous strain. The main difference is the high rate of spread and rapid infectability. Of course, this makes the population think even more about exercising increased caution. All this is supported by the introduction of strict measures on movement in London and throughout the South-Eastern part of the country. A new batch of quarantine restrictive measures is designed to prevent the mass spread of the detected infection. Many countries for this purpose have stopped transport links with the UK, which practically caused the blockade of the country. However, as it turns out now, it did not help from the penetration of a new strain into the territory of neighboring States. According to unconfirmed reports, the British virus has already been detected in Italy.
Of course, the tense situation could not put serious pressure on the markets including the precious metals market, which, I must say, is still only winning. Gold traditionally acts as a reliable asset that can play the role of a "safe haven" in protecting assets from unforeseen losses. In the current situation, this strategy is gaining popularity among investors. Markets are shaking again, which means that it is necessary to temporarily get away from this global uncertainty, so as not to be in a deep negative.
Market participants are clearly aware that tougher restrictive quarantine measures do not contribute to the recovery of the global economy, which was hoped for. Nevertheless, the hopes that the new vaccine and the beginning of its mass use will bear fruit very soon and the situation will begin to change for the better do not run out to the end. This at least somehow supports the mood of investors that has fallen almost to zero.
Another negative factor for the markets, which increases inflationary risks was the adoption of an already well-worn package of financial incentives in the United States of America. According to the latest data, the House of Representatives approved a new measure of $ 900 billion. However, the risk of higher inflation has acted as a balm for gold as market participants are expected to rush to use it as their protection.
The precious metals market is still showing a rapid growth: the increase is quite calm. First of all, this is due to the fact that against the background of all that is happening, the US national currency is strengthening and this traditionally causes a negative reaction of gold. Thus, the metal becomes more expensive in price for holders of foreign currency, which means that demand for it will either decrease or become less stable.
One way or another, gold has more chances to get ahead significantly than any other asset on the market.
