Gold is off to yet another strong start this year. Up nearly 3% in less than a week, this may be the second consecutive year that gold sets an all-time high fueled by uncertainty, fear, and doubt.
Unemployment numbers are still up, the approval and passing of a second stimulus package that came in late December will continue to devalue the dollar, thus driving up inflation. And perhaps that’s what warranted gold’s strong 3% gain to start the year.
Let us not forget to mention that 2020 was a historic year for gold as it not only had its best performance in nearly ten years, but it also set a new all-time high price record.
Even the demand for physical gold experienced a five-fold increase. The U.S. Mint is seeing a 455% increase compared to 152,000 ounces sold in 2019.
In March of last year, when the reality and severeness of COVID began to set in, followed by the announcement of the first stimulus check, is when gold began to rally.
In the month alone, there were 151,500 ounces of physical gold sold compared to the 152,000 ounces sold in the entire year of 2019. The demand for gold nearly 10x’d instantly!
Now, OANDA senior market analyst Edward Moya believes that gold will replay a similar path in 2021 and may perform even stronger.
“2021 is going to be a very strong year for gold. I am very bullish. $2,300 will be a key level. This pandemic has done tremendous economic scarring to the U.S., and what you are probably going to see is unprecedented fiscal and monetary stimulus continue in the first half of the year,” stated Moya in a recent interview.
Moya doesn’t feel that the economy will fully recover until 2022 and also that we won’t truly see the effects of inflation until later in 2021. Those predictions combined with an expected bubble burst or correction with Bitcoin would traditionally spike gold’s demand, once again.
Bitcoin is relevant in this topic as some feel that it took away from gold’s performance as it acted as a safe haven to new, less savvy investors. Coincidentally, Bitcoin started the new year by plunging over 10% in one day- around the same time when gold ran up nearly 3%.
It’s clear, the virus is still here and the money printer is running 24/7 continuously working to devalue your cash. The longer you wait, the more you may lose.
This may very well be the last warning you receive before gold likely breaks its all-time high. Call American Hartford Gold now at 800-462-0071.