The past week has been chaotic for all markets. While President-elect, Joe Biden, continued to plan for the transition, incumbent president, Donald Trump, continued to dispute the election results.
However, the biggest news was the coronavirus vaccine, from which gold traded at $ 1,870, while silver fell 7% amid the positive news.
Then, by the end of the week gold and silver rallied, following the reports of possible new quarantine restrictions, mainly due to rising coronavirus incidences in many countries.
Analysts are confident that gold will continue to grow. Orchid Research even advised to buy setbacks in the asset, citing the post-election environment, which will be defined by more uncertainty, more stimulus and rising COVID-19 cases.
Wells Fargo, a company that provides insurance and financial services in countries such as the United States, Canada and Puerto Rico, said last week that it expects gold to reach $ 2,100 an ounce by the end of the year, and then rise to $ 2300 in 2021.
There are also talks of a preference for oil over gold, at least according to Goehring & Rozencwajg Associates. They said that "oil has never been cheaper compared to gold", and they see oil significantly outperforming gold in the next five years.
The likelihood of such an event increases in parallel with the opening of new gold mining companies and the discovery of new deposits.
On Thursday, Aurelia Metals announced the acquisition of the Dargues Gold Mine for AU $ 205 million (US $ 149 million).
The deal includes AU $ 176 million, Aurelia shares for AU $ 24 million and a $ 5 million conditional payment.
Dargues is projected to produce an average of 45,000-55,000 ounces of gold at a cumulative maintenance cost of A $ 1150-1350 over the next five years.
The acquisition will be paid for with fully guaranteed capital raising.
In 2020, Aurelia produced 92,000 ounces of gold at a total cost of $ 1,520. The company already operates the Peak and Hera mines in Australia.
In the Kitco Roundtable podcast, Eredene Resource CEO, Peter Ackerley, said the move could be optimistic for the mining sector as a whole.