Gold Fall From All-Time Highs

Gold is Falling.

Gold hit an all-time high earlier this quarter, trading at $5,589 per ounce.

As of this week, it's down over 16% from that peak.

What makes that unusual is we're in the middle of an active military conflict in Iran. Geopolitical stress is traditionally the environment where gold is supposed to perform.

Historically, gold rallies when investors get nervous: in times of war, financial crises, currency instability. It's the asset people run to when they don't know where else to go.

So what's happening?

There's no single answer, but the most likely explanation is gold investors already priced in the fear. The rally to all-time highs happened before the early days of the conflict, driven by tariff uncertainty, dollar weakness, and years of central bank accumulation. All trends I covered heading into year-end. So by the time the conflict escalated, the trade was crowded, and crowded trades unwind fast.

The chart below shows the SPDR Gold Shares ETF (GLD)'s price over the past two years, including the run to its all-time high and the current pullback.

However, Gold has not broken below its 200-day moving average yet, currently sitting around $376.

That level has held as support since late 2023. If it holds above that, this could just be a pause in a longer trend. If it breaks, it could be the start of a new trend.

Until next week,

Jacob

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