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Is the bull market in gold over? Some analysts say the US presidential election may push gold prices to record highs
Sep 27,2020 11:13CST
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SMM9 March 27: U. S. stocks opened lower and higher on Friday, investors focused on the global epidemic situation, and the three major stock indexes collectively closed higher. By the close of the day, the Dow was up 1.3% at 27174.0, the S & P was up 1.6% at 3298.5, and the Nasdaq was up 2.3% at 10913.6. In terms of weekly performance, US stocks as a whole fell first and then rose, with the Dow down 1.8%, the S & P 500 down 0.6% and the Nasdaq up 1.1%.

This week, the dollar rallied strongly, hitting a more than two-month high of 94.75, prompting a frenzied sell-off in gold, with gold futures down 4.9 per cent, the biggest weekly decline since the week of March 13.

As of the close of the day, COMEX gold futures closed at US $1866.3 / oz, down 0.56%; this week, COMEX gold fell nearly US $100USD / oz under a series of negative factors.

According to some analysts, the fall in gold prices may be temporary. Christopher Louney, capital markets strategist at Royal Bank of Canada, said uncertainty over the upcoming US election could boost gold and any further clashes ahead of the vote would help boost precious metals.

"in the face of economic uncertainty, the US election cycle and any potential transitions and geopolitical tensions remain," Christopher wrote in a report. Over the next two quarters, "the recent decline in gold has provided room for further substantial gains".

Citigroup analysts said earlier this week that risks surrounding the US presidential election could still push gold to a new record by the end of the year.

With regard to this wave of decline in gold, Li Baiyu, a mid-term futures researcher in Shanghai, said that concerns about the recovery brought about by the second wave of the novel coronavirus epidemic in Europe, as well as recent "hawk" monetary policy remarks by a number of Fed officials, caused the US dollar index to rebound from the bottom, putting pressure on the gold price. In addition, U. S. stocks fell for four consecutive weeks, investors are eager to sell gold to make up for losses in other assets, also further exacerbated the decline in gold.

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