Gold Price Drop

Here’s a breakdown of how I see the recent drop in gold prices — whether it looks like a pullback, a rout, or a buying opportunity — along with what the market consensus appears to be.

What’s happening

• Gold recently peaked above US $4,300/oz before dropping ~2 % (or more) in a short span, after hitting a record high.

• The drop is attributed to a combination of:

  • A firmer U.S. dollar (makes gold more expensive in other currencies)

  • Some easing in safe-haven demand (for instance, comments from U.S. leadership around trade with China)

  • The fact that gold is now “overbought” in many analysts’ views, suggesting a technical correction might be underway.

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