The gold market tumbled sharply a day after hitting an intraday record high of $3,500 per ounce, sparking debate over whether the precious metal’s historic rally has run its course. However, Bart Melek, Head of Commodity Strategy at TD Securities, argues the bull market remains intact. In a recent interview, he noted that while gold appears overbought on technical levels, it is still significantly undervalued in the broader macroeconomic context.
Melek highlighted gold’s inflation-adjusted all-time high from the 1970s, which translates to $3,544 per ounce in today’s spot market—a potential technical target. He identified $3,100 as critical support in case of deeper corrections. Spot gold last traded at $3,279.10, down over 6% from recent highs.
While speculative commodity trading advisors (CTAs) are cashing in profits, non-CTA investors remain sidelined due to high carry costs and skepticism about the Fed’s rate-cutting resolve. However, central banks continue to buy aggressively. Melek emphasized that geopolitical tensions and declining confidence in the U.S. dollar are driving nations to diversify reserves, creating long-term demand.
Fawad Razaqzada, Market Analyst at StoneX Group, called the 6.8% two-day drop “a drop in the ocean” compared to gold’s 25% year-to-date and 41% 12-month gains. He stressed that holding above $2,956—the pre-breakout low—would validate the bull trend, with pullbacks offering buying opportunities. David Morrison, Senior Market Analyst at Trade Nation, added that a deeper reset to $3,000 could pave the way for new highs.
George Milling-Stanley, Chief Gold Strategist at State Street Global Advisors, noted gold’s ETF inflows signal untapped demand. SPDR Gold Shares (GLD) recently surpassed $100 billion in assets under management, a historic milestone. He warned that the dollar’s eroding reserve currency status could destabilize bond markets, boosting gold’s appeal.
David Miller, Senior Portfolio Manager at Catalyst Funds, underscored that central banks purchased over 1,000 metric tons annually since 2023—a dominant force overshadowing retail activity. State Street revised its 2025 gold forecast, with a base case of $2,800-$3,100 and a bull case of $3,100-$3,400.
Milling-Stanley concluded: With fears of recession, stagflation, and dollar distrust swirling, it’s hard to see gold’s fundamentals weakening. For long-term investors, this is far from the endgame.
While profit-taking and Fed uncertainty stir short-term volatility, analysts agree that structural shifts—central bank buying, dollar skepticism, and geopolitical fractures—keep gold’s bull market alive. The $3,500 peak may be just a pit stop, not the summit.
