Market Update April 9 – Gold and Silver Rally Continues

Gold and silver are shining brightly in 2024. The price of gold has increased by USD $300 per ounce, or 14%, since January 1st, and silver has experienced an impressive 18% jump. This significant growth has not only captivated the investment world but also prompted analysts to predict further gains in the months ahead.

A notable aspect of this recent rally is that gold and silver are rising despite competing factors that have historically impeded their progress, such as a strong US dollar (currently 104.06 on the DXY). Gold and the US dollar have a long-established inverse relationship, meaning that strength in the dollar typically leads to weakness in gold, and vice versa.

Also of interest is the fact that this rally has been largely fueled by the Asian market, particularly by Chinese investors who are shifting from high-risk domestic real estate investments to gold. According to the World Gold Council, consumer demand for gold in China increased by 16% in 2023, while demand for gold bars and coins rose by an impressive 27%.

Meanwhile, North American investors, enamored by AI stocks and Bitcoin, have paid little attention of late. However, this trend now seems to be changing as gold and silver have captured headlines across leading financial publications, indicating that more dollars will be flowing into these metals, helping the rally continue its upward trend.

Geo-political uncertainty remains high, with over 60 countries holding elections this year, including the United States. Additionally, conflicts in Ukraine and Gaza persist, where Israeli Prime Minister Benjamin Netanyahu has vowed to continue the fight and eliminate Hamas, stating on Monday, "…victory requires entry into Rafah and the elimination of the terrorist battalions there. It will happen - there is a date." Other leaders have expressed grave concerns that these actions will escalate regional tensions and cause severe loss of life.

From a technical analysis perspective, gold has clearly broken through and held above a key resistance point of $2100/oz. With mining production having flattened since 2020, analysts' predictions of gold reaching USD $2450/oz and silver reaching $32/oz now appear to be within reach.

Follow Mark on Twitter @YaxleyYax

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Mark Yaxley, CEO of Strategic Wealth Preservation (SWP), began his journey in precious metals with Kitco Metals in 2006. Co-founding SWP in 2014, he now guides individual and commercial clients towards their investment goals. Renowned for his 'Inside the Vault' YouTube series, Mark has helped millions gain insights into gold and silver bullion ownership.