Most gains in the commodity market in 2021 have been lost. With an emphasis on Gold and Silver, Silver’s price at the beginning of the year at $26.605 per ounce. Price rallied to $30 on the 1st of February, after which a major dip began. Today’s current price of silver at $23.685 was last reached during the lockdown in April 2020. The long time frame shows that price of $XAGUSD might dip in the coming months or years, as RSI shows that price has been overbought.
Could it be that the pandemic might pose a further threat to the commodity market? The last time the commodity market was badly affected was in 2011 after it reached a peak at $50. In 2018, the US Department of Justice (DoJ) had arrested a former long-time precious metal derivative trader from JP Morgan Chase for precious metal fraud. This year’s fall in price might be a result of increasing cases of Covid-19 across the world.
We might see a rally in the price of Silver in the coming weeks as there was a bounce on the support level at $22.246. All Silver gains in 2021 have been lost with -10.9%. Price is currently at the lower region of the Bollinger bands, but we have an indication on the RSI that the price is oversold. In the last 5 trading days, the price has been consolidating, which could lead to the next bull run to $27.902.
$XAUUSD’s price at the first trading in 2021 was $1902. Buyers made price reach at yearly high at $1959., which was about 3% gain. Gold has lost all the gains this and at a loss of 5x from the initial monthly gain. In April, we wrote of the continuous fall in the price of Gold. . There was an uprise to $1918 from $1778 after the analysis. Nevertheless, after the rally, the price fell to $1740 this month, where the article’s next support level was pointed to.
Many manufacturing countries might have reduced production, which could have been as a result of low patronage caused by Covid-19, hence the reason for the drop in price. Price was initially showing overbought in May, but in June and August, the price of Gold showed the price is oversold. The current price of Gold is at $1779.24, as last week’s trading closed high. This indication could push the price to $1895, renewing hope for the gold investors.
