by Alex Deluce, Gold Telegraph:

If you’ve invested in gold, congratulations. The yellow metal is set to continue its rally in 2020 and keep moving upward. Here are some of the signs:

1. Gold is seeing the best returns since 2010.


2. The price of gold soared by 15 percent in 2019.


3. Gold is breaking over $1,500. Many investors have been waiting for this. Such a round number breaks through psychological resistance.

While it’s hardly set in stone, there is a history of gold since 2013 rallying at year-end and closing on a high, and this trend is likely to continue. The year 2020 could see record-breaking high gold prices. One of the driving forces behind the rise in gold prices is the trade war between the U.S. and China.

Many investors have played it safe and turned to gold instead of the stock market or are taking a wait-and-see attitude. Should the tensions between the U.S. and China cease, the price of gold is expected to fall. Such an economic event, however, is not anticipated to happen anytime soon. So far, there has been no trade deal between President Trump and China. There might never be. It’s not just trade that is causing tensions between the two countries. The riots in Hong Kong and China’s repressive policy toward the Uighur Muslims are exacerbating the problem.

China is unlikely to agree to any trade agreement prior to the 2020 election in the hopes that President Trump will be voted out of office. That leaves 2020 for the price of gold to surge. And if President Trump remains in office, gold is expected to rise for the next four years. 

The global political climate has rarely been this uncertain. France and Hong Kong have endured non-stopped riots for weeks. Gold prospers in this type of uncertainty. If the trade deal between the U.S. and China fails to materialize, investors are counting on gold bursting through that all-important $1,500 range with no market cap in sight.

While the U.S. economy appears strong, there are some weak spots. The demand for durable goods was down by 2 percent in the fourth quarter. Consumer spending, on the other hand, is seeing a free-for-all high with debt spinning out of control. Neither bodes well for the U.S. economy.

The Federal Reserve is making borrowing easier, pushing more and more consumers and businesses into debt. If this trend continues – and it will in all likelihood – the resultant recession with drive the price of gold even higher. 

China isn’t the only country posing a trade uncertainty. Several Mideastern countries, Iran, Malaysian, Turkey, and Qatar, are looking to use gold instead of dollars in future trades. Russia has been busy dumping Treasury debts and limiting its trades in U.S. currency, thus weakening the U.S. dollar. Russia has been increasing its gold holdings, as well, up to $548 million. 

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