In addition to the fact that this is the best price for gold we have seen in recent memory – which means you can add this safe haven store of wealth to your portfolio at an unbelievable price by buying the dip – the precious metal is primed to spike sky high.
Analysts warn that when the dust settles on Pfizer’s announcement and the relief subsides, reality will set in and that is nothing but good news for gold. Commodity analyst Robin Bhar says he wants to buy gold on the dip, saying “There is still a long way to go before a vaccine will be accessible to everyone.”
Scientists agree, with the London School of Hygiene and Tropical Medicine’s professor of microbial pathogenesis, Brendan Wren cautioning, “You can certainly make a lot of it but whether you could get it to everybody that needs it is another issue.” Many have also warned that the arrival of a vaccine doesn’t mean the pandemic will disappear, which means all of the factors propelling gold remain. UK Health Secretary, Matt Hancock described news of the vaccine as, “one step of many we need to get out of this and to tackle this pandemic once and for all”.
Saxo Bank’s head of commodity strategy, Ole Hansen sees a positive long term outlook for gold and is bullish on price rises, noting “The virus could go away, but that does not mean economic growth will turn around on a dime. A lot of damage has been done that can’t easily be fixed or that will take a lot of time. There is still plenty of uncertainty to support gold’s new regime. A vaccine is positive news, but it doesn’t change the narrative. The reality is that interest rates won’t be hiked anytime soon, and that will continue to be good for gold.”
Away from the vaccine, President Trump’s refusal to accept the US election results is also a gathering storm cloud. With legal action ongoing, President-elect Joe Biden hasn’t been able to initiate the transfer of power and there are deep-seated concerns that the Republican refusal to concede has seriously undermined the democratic process. When that plays out in January and the new administration moves into the White House, markets could face further stumbling blocks; again that’s good for gold.
Buy, buy, buy.