FX.co ★ Gold will reach new peaks in 2021

Short-term and medium-term forecasts for gold's price are most often positive. Analysts of the investment Bank, ABN AMRO, hold a similar point of view. Experts have improved the previous forecast for the gold, but warned market participants about some risks.

Analysts at ABN Amro are sure that gold will be trading at $ 2,000 per ounce by the end of 2021. The main factors supporting the precious metal are low real interest rates in the US and a weakening US dollar. Experts predict low yields on US government bonds and recommend that investors should monitor changes in the monetary policy of regulators and the growing budget deficit.

However, they warn about three major risks for the gold market: changes in investors' strategy in precious metals, a possible collapse in the technical picture and global economic problems. With regard to the first point, there is a risk that investors will begin to get rid of investments in the securities of ETF funds. It should be noted that experts have recorded a small outflow of funds from the indicated funds over the past few weeks. If this trend worsens, the price of gold will be under strong pressure.

ABN Amro's analysts are relatively calm about the technical outlook for the yellow metal, but some changes in its dynamics are worrying. The bank emphasized that it started to decline by the end of this year. If gold's price is below the average (over the past 200 days), ABN Amro warns that a further upward trend will be unlikely.

Many strategists of the precious metals market are concerned about the global economic situation amid the COVID-19 pandemic. Experts fear that negative trends will continue next year. If this scenario is implemented, the gold market may undergo correction and clearly decline. However, analysts' forecasts for the gold are mostly optimistic, so the third risk factor identified by ABN Amro is not yet a serious concern.

Currently, experts consider the most attractive for investment metals, which are actively used in industry. These include platinum (40% of the demand for it comes from the auto industry), as well as silver, copper and aluminum. They are particularly enthusiastic about white metal. Experts agree that silver has a huge growth potential. OII cites the period from 2010 to 2011 as an example, when silver's price soared from $17 to $50, that is, almost three times. Experts believe that with such growth rates, silver has a great future and assume that the price ratio for Gold and Silver can be 1: 55 in a few years.

By the end of this year, yellow and white metals managed to recover from the collapse to their lows recorded at the end of November. According to analysts, the new wave of the upward trend, which began in mid-December 2020, will continue until spring 2021. Today, the price of gold slightly rose within the current correction, moving around $ 1864 per ounce. The weakening US dollar contributed to this.

ABN Amro analysts believe that like silver, gold will sharply move to new peaks in the coming year. According to the basic scenario, gold's value will be $ 1950 per ounce in 2021, and will likely rise to $ 2050 in 2022. A more optimistic scenario assumes a rise to $ 2200 - $ 2400 per ounce. They summarized that the soft monetary policy from central banks will support this.