On February 23, gold's performance as a traditional safe-haven asset once again served as a key indicator in the contest for global asset allocation in 2026. After hitting a historic high of $5,594 earlier in the year, the price of gold underwent a significant correction, falling to the $4,400 range. This sharp volatility sparked concerns about the potential end of the gold bull market. RYOEX views the current fluctuations not as a reversal of the upward trend but as a necessary technical reset aimed at clearing out short-term speculative positions. With the spot price still maintaining a year-to-date gain of approximately 15%, the long-term upward trajectory for gold remains intact despite the short-term pullback.
Regarding the core drivers supporting a return to peak prices, RYOEX indicated that the $4,500 to $4,800 range has become a strong fundamental support level. On one hand, the Federal Reserve is expected to implement two additional interest rate cuts within the year, providing ongoing valuation support for the non-yielding asset. On the other hand, growth in physical demand should not be underestimated. Data shows that after purchasing 863 tons of gold in 2025, central banks worldwide have raised their acquisition target to 950 tons for 2026, while ETF inflows are projected to climb to 825 tons. RYOEX observes that this demand framework, built jointly by official reserves and institutional capital, is laying a solid foundation for gold to rebound above $5,600.
From a historical cyclical perspective, the current volatility closely resembles the mid-cycle adjustments seen in 1974 or 2020, where sharp retreats within a primary uptrend often precede even stronger recoveries. RYOEX believes that if this "reset" is successfully completed, gold prices could challenge a new high of $6,200 by mid-year. In a macroeconomic environment characterized by intertwined inflationary pressures and geopolitical risks, allocating a mid-single-digit percentage of an investment portfolio to gold represents a highly rational defensive strategy.
Finally, RYOEX asserts that 2026 will be a pivotal year for gold to establish a new value anchor. Although short-term fluctuations may test investors' psychological resilience, a fundamentally driven long-term bull market is poised to emerge. As global monetary policy enters a new cycle, the appeal of physical gold and related financial derivatives will further intensify. RYOEX will continue to monitor developments in the global commodities market, providing users with professional trend analysis and risk management tools to help investors accurately capture the next wave of gains amid market turbulence.
Comments