Today’s surge in gold value took a lot of market watchers by surprise. Even though the overall circumstances favor safe haven assets, all eyes are directed elsewhere. Based on a recent Bank of Montreal report, the bullish trend may remain in place for another two years.
A Strong Gold Prediction
The past 24 hours have yielded a lot of market momentum that wasn’t necessarily expected. Both gold and silver started moving up again in a rather convincing manner. A somewhat unexpected turn of events, given the ongoing sideways trading behavior affecting both markets. There are also no real macroeconomic events at play to warrant a big uptrend right now.
One interesting bit of information is provided by bank of Montreal analysts, In a new report, they claim the long-term gold and silver prices have been raised. In their opinion, gold will not drop below $1,800 an ounce until late 2023. Considering how bank estimates are usually rather conservative, this is a very bullish signal altogether.
Looking back at the remainder of 2020, the gold price should remain at least above $1,920 per ounce. A very promising target, especially when considering how gold has not dropped below this level despite the recent sideways trading. There are plenty of reasons to remain bullish on bullion for the foreseeable future.
This latter forecast is interesting. More specifically, the Bank of Montreal forecasted a 4% lower price earlier this year. As such, it is likely to assume their current target is also conservative, with actual gold prices potentially going much higher. It will all come down to how well the global economy recovers in the wake of COVID-19 and a potentially third wave of infections coinciding with the flu season.
Silver Gets a Healthy Boost
Throughout 2020, silver has outperformed gold in a way. It is the most bullish precious metal of the two, something the Bank of Montreal analysts noted as well. Similar to gold, they predict silver will remain above $27.6 until late 2023. A lot of silver bugs will be very pleased with this forecast.
Comparing this to the gold forecast, silver’s prediction is up by roughly 50% compared to the earlier estimates. Banks often get their forecasts wrong, but these margins are unheard of. Precious metals such as gold and silver are creating shockwaves no one saw coming. Now is a good time to have both in one’s portfolio.