"The gold market is currently going through a delicate phase that clearly reflects the nature of this asset as a mirror of macroeconomic balances, rather than merely a commodity subject to short-term speculation. The recent pullback in gold prices from record highs, which began during the early hours of today's trading session, should be viewed as a natural step following an exceptional rally that pushed the yellow metal to unprecedented historical levels."
"Profit-taking activity led by speculators after reaching record highs reflects typical market behaviour when prices become overstretched in the short term. The sharp rise seen in recent sessions created an ideal environment for reducing exposure, particularly among short-term investors who prefer locking in profits rather than facing the risks associated with year-end volatility. In my assessment, this modest pullback carries no fundamentally negative implications; instead, it suggests that the market still retains underlying bullish momentum that merely requires fresh catalysts to resume its advance."
Gold experienced a pullback from record highs as a natural consequence of an exceptional rally. Speculative profit-taking and reduced liquidity ahead of year-end holidays contributed to the decline. The correction represents investor repositioning rather than a structural trend reversal and carries no fundamentally negative implications. Underlying bullish momentum remains and will likely resume once fresh catalysts emerge. US dollar strength has applied downward pressure by making gold pricier for non-US buyers, but current dollar momentum appears insufficient to reverse gold’s path within a monetary environment gradually shifting toward easing. Gold’s 2025 performance after substantial prior gains will be decisive for future trend assessment.
Read at London Business News | Londonlovesbusiness.com
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