Those who have kept a close eye on the market will not be too surprised with the current gold price trend. It was merely a matter of time until the $1,900 point was reached. Ongoing political and financial tension will help contribute to a future uptrend.
Gold Briefly Hits $1,900 an Ounce
It is interesting to see how the markets are responding to the coronavirus today. Any excitement over more lowering strict requirements has evaporated completely by this point. No country is safe from this pandemic, as it appears the second wave of infections has kicked in on a global scale.
Following these devastating developments, the entire world continues to flock to alternative investment options. Cryptocurrencies and precious metals are bound to see an even bigger influx of new capital in the coming months. That does mean that gold’s current value of $1,900 an ounce may be a mere stepping stone, all things considered.
It is worth noting the current price levels seen today were not reached for several decades. That in itself further affirms how bullish the current rally really is. Very few speculators expected these levels to be reached in this modern day and age. Based on the current trend, they may pave the way for a new all-time high later in 2020.
Political Tensions Remain
Several developments are brewing behind the scenes to warrant an ongoing gold price uptrend. Ongoing tensions between the US and China, for example, are something that simply can’t be ignored. China is ordering the US to close its consulate in Chengdu.
This is, in turn, a direct result of the Trump administration forcing Beijing to shut down its consulate in Houston. This one-upmanship can’t keep going on forever, but for now, both sides are content to keep the game afoot.
As was to be expected, these tensions caused the stock market to take another big hit. There are still quite a few earnings reports waiting to be revealed. Those can have a massive impact on stock market prices moving forward.
Weakening US Dollar
Another crucial aspect of this situation is how the US Dollar isn’t looking too strong either. Compared to the Euro, the greenback could be doing a lot better. The current ratio between the two sits at $1.158 for the first time since 2011. Another confirmation of how dire the situation has gotten in the past few months, with no real improvement in sight.