We hope you are enjoying this Wednesday and are ready to read a lot about the price of precious metals, particularly gold. That topic dominates our news for you today. Check them out—most are bullish on the yellow metal. One analyst thinks gold will reach the $2100 level by the beginning of next year.

Let’s dig in…

Economy
A Blue Wave Election Result Will Slap Down Stocks Long-Term, Gold Will Flourish

And BofA was worried, because since online odds still have a Biden victory as virtually assured, the reason for the slide in the chart above is the sudden surge in doubt that Democrats will wrest control of the Senate. Only without the Senate, the key anchor of the "stimulus" and "reflation" trades is gone. In fact, according to BofA the only scenario worse than a Trump presidency and a Democratic Congress (which results in Stagnation), is a Biden presidency and a GOP Senate, which would lead to Deflation. This is how the bank described this particular scenario: President Biden + Republican Senate = Bearish Gridlock. If Republicans retains the Senate they are very likely to block further stimulus under a Democratic President, which BofA says would be bearish for economic growth, corporate profits and financial markets (but it would be bullish for more stimulus from the Fed). In any case, as BofA sarcastically puts it, "after $21tn of monetary & fiscal stimulus in 2020, $0 of follow-on support would be deflationary." Indeed, political parties historically have…

Latest News
Gold Goes Up, Dollar Comes Down as COVID-19 Sticks Around

(Reuters) - Gold prices rose on Tuesday, helped by a weaker dollar and worries over a second surge in coronavirus cases, while investors held back from making large bets ahead of next week’s U.S. presidential election. Spot gold was up 0.4% at $1,908.84 per ounce at 11:45 a.m. EST (1545 GMT). U.S. gold futures rose 0.3% to $1,911.40. The dollar index slipped 0.2% against its rivals, making gold less expensive for holders of other currencies. [USD/] “Gold is stuck in a tight range and there’s probably not going to be too much activity before the U.S. election,” said Michael Matousek, head trader at U.S. Global Investors.

KEEP READING

Economy
Guess Who Became a Net Seller of Gold for the First Time in a Decade?

The answer is Central Banks, who have shifted to being net sellers again after ten years, and their net sales are estimated at just under thirteen tons for the third quarter according to a Refinitiv research. The shift was driven by an absence of purchases from Russia and China, as well as a significant rise in gross sales as countries continued the battle against COVID-19, which has taken a severe toll on the global economy, with perhaps some also taking advantage of gold's astonishing price performance in recent months.

Commentary
2021 Could Be a Dominant Year for Gold

A new year – thankfully – quickly approaches, which means an avalanche of market predictions is soon to cascade across Wall Street. So, let’s jump the line and get ahead of the crowd: 2021 could well be the Year of Gold. Not that 2020 hasn’t already been a solid year for the anti-dollar. Gold trends, at a recent $1,910 per ounce, is up 25% for the year, and there’s still the potential for an election disaster or a non-peaceful transfer of power that could propel the metal even higher on the “fear trade.” But let’s assume that’s not the case and gold has a fairly uneventful final two months of the year. That brings forth 2021 and either a new administration in the White House, or the same administration. And either administration will very likely mean higher gold prices as the approaching year unfolds.

Price
Gold Prices Should See $2100 Level Early in 2021, Says Standard Chartered

Gold is continuing to take its cues from the U.S. dollar as analysts focus more on the fiscal stimulus prospects rather than the election itself, according to Standard Chartered. Even though the macro environment remains very supportive of higher gold prices, the precious metal is stuck at the $1,900 an ounce level, said Standard Chartered precious metals analyst Suki Cooper. “Gold prices continue to oscillate around USD 1,900/oz, between the 50-day and 100-day moving averages, but continue to take their cues from macro drivers, predominantly the USD rather than real rates,” Cooper wrote on Friday. “We expect this to remain the case leading up to the U.S. presidential election.” The amount of attention being given to stimulus seems to be taking away from gold’s potential upside in case of a Democratic win across the board.

Price
Precious Metals Should Prepare for Next Price Advance

As we continue to near the November 3rd election day, Precious Metals have continued to trade within a narrow range suggesting price support is staying strong. It is my belief that potential downside risks for Gold and Silver will be relatively short-lived after the election. We believe the broad market decline witnessed on October 26, 2020, where the Dow Jones fell over 700 points, coupled with the fact Gold and Silver barely budged throughout the selloff, suggests support for Precious Metals has reached a “battle line”. My research team has highlighted the current support and resistance price levels for both Gold and Silver on the charts below. We believe the initial support levels will hold up well throughout the pending election and that an upside breakout in both Gold and Silver are likely outcomes after the elections. Global traders and investors have already likely hedged their portfolios accordingly to attempt to eliminate risks, yet the fear of what is not known is one of the main drivers of appreciation in Precious Metals.READ MORE

Thanks,
Gold Silver Central