22.07.202017:43 Forex Analysis & Reviews: Silver and gold rises amid global pandemic

The gold market was moved on Wednesday thus continued to rise. The price of precious metals is growing during the Asian trading session.

Precious metal futures for August delivery on the New York trading floor gained 0.76%, which allowed it to reach the level of 1,857.90 dollars per troy ounce. At the same time, the support level turned out to be around $ 1,795.20 per troy ounce, while the resistance moved to the level of $ 1,866.75 per troy ounce.

Gold quotes were able to quickly reach its first target of $ 1,827 per troy ounce. It should be noted that this strategic level was designated literally last week. However, the growth did not end there, but only intensified and is gaining momentum, which pushes the price higher and higher. Most analysts believe that the rally will not end soon, and during it, more than one value record will be broken.

The reason for such an unrestrained positive was the hopes of investors that stimulus measures in many countries of the world, including the United States of America, would not only continue to the extent that they already have but will also significantly expand.

At least, there is already an active discussion of the bill on a new portion of financial support for the US economy. However, the authorities still cannot decide on the final volume of future incentives. One way or another, this uncertainty is putting serious pressure on the greenback, which is beginning to change the vector of its movement in a negative direction. The traditional fall of the dollar is a good support for the precious metals market. This is what we are seeing at the present time.

Another negative moment for the greenback is the news about the preparation of a vaccine against coronavirus infection, which is entering the home stretch. The imminent appearance of a drug capable of containing the pandemic will weaken the dollar even more, which plays into the hands of gold, the price of which is moving in the opposite direction.

Equity markets were also cheered by the news of the COVID-19 vaccine, which pushed the major indices up well. This is evidence of the growing interest in risky assets, which, in theory, should put pressure on the gold market. However, this may not happen since the precious metals market is a very convenient way to protect against inflation, the level of which is growing every day.

Thus, it turns out that now is one of the most favorable moments when it is worth moving on to buying gold and other precious metals.

Silver also continues to show explosive growth rates. Over the past four months, this metal has become more expensive by as much as 80%. At the same time, analysts say that this is far from the limit of the rise in its value, so we can say that new records will be broken.

Until the last moment, the gold overshadowed the silver but the time has come when it gradually comes out of the shadows. At the beginning of this week, silver was finally able to cope with the extremely important mark of $ 20 per troy ounce which continues to gain momentum at present.

Such significant successes of silver did not go unnoticed in the market. Investors were immediately inspired by this situation since the precious metal had not had such indicators for almost four years.

Now, the main task of silver is to firmly gain a foothold at the current level in order to maintain the emerging trend and move on to storm the next strategic mark of $ 21.15 per troy ounce.

The growth rate of silver futures is very intense. On Monday, at the closing of trading, there was an immediate rise of 2.2%, and its cost was already $ 20.192 per troy ounce. It should be noted that during the trading day the precious metal rose to the level of $ 20.297 per troy ounce.

At the opening of trading on Tuesday this week, the price of silver futures was able to reach a high level of $ 20.688 per troy ounce, which, in fact, was a demonstration of the metal's growth by 77% compared to March this year. Recall that this spring its value tested the minimum level around $ 11.645 per troy ounce. Even gold, which still remains the more popular among metals, failed to achieve such results: its rise was only 25%.

However, the potential of silver is very high, as almost all experts agree on this. After breaking through the strategic value of $ 20 per troy ounce, further rapid growth is only a matter of time. However, it is still worth taking some caution, since the political, economic, and epidemiological situation in the world remains tense. To gain stability, the precious metal needs to rise to the level of $ 35.5 per troy ounce, but an increase of more than 84% from current prices still seems too unrealistic.

However, this did not prevent silver from showing an additional 6% increase this morning at the opening of trading, which moved it to the area of $ 21.4 per troy ounce. Later, its value soared by 5.35% and reached $ 22,710 per troy ounce.

Copper futures for September delivery continued the positive trend and gained 0.37%. As a result, it cost about $ 2.9733 per pound.