As has been expected for some time now, the gold market shows ample of recovering today. In fact, the current surge is one of the biggest of the decade, indicating that investors are slowly coming back.
Gold Price Bounce is Strong
Traders and experts have called for a gold price bounce in recent weeks. While it took a bit longer to materialize than initially expected, the current trend is very impressive. On the chart below, the weekly candle for gold is very impressive. A jump by over $100 in quick succession goes to show there is still a lot of life left in this market.
Some experts claim that this surge is the biggest in over a decade. While it is not uncommon for markets to bounce back after some bearish momentum, a near 7% jump is rather uncommon for precious metals.
It is a far bigger gain than most people had anticipated. Long-term traders and holders will be pleased with the current market momentum.
Market circumstances are also in favor of precious metals and cryptocurrencies. As the Federal Reserve continues its unlimited printing, the US Dollar will continue to weaken. That will, in turn, create more attractive alternative investment opportunities.
Furthermore, there is the reduced production of a few gold mines. Several mines are forced to slow down production, or halt it altogether. A handful of Swiss gold refineries are now closed for at least one week due to coronavirus concerns.
Experts Expect a Higher Bullion Price
It is also worth noting how gold is now trading at the highest value since early February on Comex. This momentum will eventually translate to the regular market value surpassing early March’s levels again. How high the price can go this time around, is anyone’s guess. The current market situation is unprecedented.
Earlier this week, Goldman Sachs analysts expressed a bullish opinion on bullion. Due to COVID-19, the analysts expect the bullion price to go higher in the near future. Gold is still a stable store of value and a “safe haven asset” for many investors, traders, and speculators. Stimulus packages will only increase the demand for precious metals.