After a prolonged period of decline, the gold market has experienced a strong rebound. On May 6, international gold prices surged following brief fluctuations. At the time of writing, spot gold in London was quoted at $4,696.03 per ounce, marking a significant intraday increase of 3.08%. The price reached a high of $4,708.56 per ounce during the session, briefly surpassing the $4,700 per ounce threshold.
Futures markets also advanced. COMEX gold futures rose sharply by 3.11% to $4,710.4 per ounce, with a session peak of $4,720.2 per ounce, also breaking through the $4,700 per ounce level, moving in tandem with spot prices.
The domestic gold market showed similar strength. By the afternoon close, gold T+D on the Shanghai Gold Exchange surged 1.92% to 1,026.46 yuan per gram, while the main gold futures contract on the Shanghai Futures Exchange jumped 2.27% to 1,028.48 yuan per gram, indicating synchronized momentum between domestic and international markets.
Multiple factors contributed to this rapid price increase. Wang Weimang, Investment Manager at Zhonghui Futures Asset Management Department, noted that developments in U.S.-Iran relations served as a direct catalyst for the rally. As a core safe-haven asset, gold attracted continuous inflows amid rising geopolitical uncertainty. Concurrently, a weaker U.S. dollar and a sharp decline in Brent crude oil provided additional support. Although the drop in oil prices alleviated some inflation concerns, geopolitical risk premiums remained elevated.
Technically, Wang pointed out that gold hit a one-month low on May 5, prompting technical buying. Combined with prior weekly declines, some investors viewed gold as oversold. Additionally, mixed expectations regarding the Federal Reserve’s stance—maintaining rates in 2026 while potentially raising them in 2027—further enhanced gold’s appeal amid policy uncertainty.
Zhang Pengyuan, Researcher at Paipaiwang Wealth, attributed the rally to multiple drivers. Sentiment-wise, some investors took profits after geopolitical tensions eased, while others entered at key levels, fueling a technical rebound. Macroeconomic factors, such as declining U.S. Treasury yields, reduced the opportunity cost of holding gold. Looking ahead, sustained central bank purchases, potential rate-cut expectations, and ongoing geopolitical risks are expected to support gold’s medium- to long-term value. Short-term price movements may remain volatile, with technical resistance capping gains, as trends revert to core macro variables like real interest rates and the dollar.
Hou Yanjun, General Manager of Houshi Tiancheng Investment, emphasized that against a backdrop of global monetary expansion, deglobalization trends, U.S. debt concerns, and a gradually weakening dollar, the structural bull market for gold and silver remains intact. Current prices are consolidating around long-term averages, with future direction hinging on outcomes of U.S.-Iran tensions and signals from the Federal Reserve.
Short-term, Wang Weimang highlighted $4,500 per ounce as a key support level, with resistance between $4,640 and $4,895 per ounce. Prices may fluctuate within this range, though post-rally pullback risks persist, especially as rate-cut expectations fade and high interest rates continue to pressure non-yielding assets like gold.
Medium- to long-term outlooks remain optimistic. Wang cited upward revisions to year-end targets: Goldman Sachs raised its forecast to $5,400 per ounce, J.P. Morgan projected $6,300 per ounce, and Wells Fargo anticipated $6,100–$6,300 per ounce. Robust support factors include continued central bank gold purchases, gold’s strategic role in de-dollarization, and its low correlation with equities and bonds, enhancing portfolio diversification.
For investment strategies, Zhang Pengyuan recommended incorporating gold into asset allocations to mitigate risk. Gold ETFs and accumulation plans offer cost and liquidity advantages. Investors should adopt a phased approach, avoid chasing rallies, and manage positions prudently. A long-term perspective is advised, with emphasis on using idle funds and avoiding leverage to navigate market volatility effectively.
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