The usage of alternative energy sources, such as solar panels, becomes increasingly popular. But the main problem is that precious metals, such as silver, vanadium, lithium, iridium, platinum, and palladium may be in short supply because they are widely used in the production of solar panels.
Experts say that the era of clean energy is not far away which may lead to a large shortage of essential minerals. Also, platinum group metals will sharply rise in price. Experts fear that someday humanity will reach the limits for the extraction of raw materials. In this case, it will be necessary to expand the resource base to meet the increased demand for clean energy.
What dynamics will gold show?
Recently, it became known about the effectiveness of a new vaccine against coronavirus developed by Biontech, Pfizer and Moderna. This news rocked the markets. Investors are again showing interest in risk assets which negatively affects gold and silver.
The creation of a vaccine gives hope for the early lifting of quarantine measures, due to which the global economy has been hit hard. In this case, it does not matter how quickly we get back to normal life. The exchanges will immediately start selling “happy future”.
Gold will have a chance to grow when the euphoria in the markets ends, and it becomes known how many more millions or billions will be needed to overcome the consequences of the crisis.
But by this time, other news may be in the spotlight. For example, the inauguration of the new US president who will announce his plans for the coming years. In any case, the central bank will continue to issue unsecured money in order to minimize losses from the pandemic. In other words, the purchasing power of currencies will fall, while gold will continue to rise.
Meanwhile, gold futures declined during Asian trading on Wednesday. Gold lost 0.43% to trade at $1,876.90 per troy ounce. The support level is at $1,860.70 and the resistance level is at $1,898.00.
Silver for December delivery lost 0.66% to settle at $24.488 per troy ounce. Copper also decreased by 0.09% to hit $3.2037 per pound.
The US Dollar Index Futures, which measure the US dollar against a basket of six major currencies, fell by 0.04% to trade at 92.433.
The material has been provided by InstaForex Company – www.instaforex.com
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