Spot gold fell roughly 3% last week, breaking below $3,300 per ounce on the weekly chart. Wall Street analysts have turned decidedly bearish, noting that $3,300 may continue to cap gains in the days ahead. Still, lingering sovereign‐debt concerns and steady central‐bank buying should limit any deep sell-off through the summer.
Each year between June and August, precious metals—particularly gold—tend to enter a seasonal lull known as the “summer doldrums.” Characterized by narrower price swings, lighter trading volumes and muted upside momentum, this period reflects a blend of seasonal factors, shifting risk appetites, subdued physical demand and a lack of fresh policy catalysts.
In a survey of 17 strategists, 53% expect gold to weaken further this week, citing deteriorating technical patterns and improved investor risk tolerance.
Independent metals specialist Jesse Colombo (Bubble Bubble Report) warns that as the U.S. kicks off its Independence Day long weekend and summer trading season, investors should brace for further price weakness. He forecasts gold will trade within a broad $3,200–$3,500 range per ounce over the coming weeks.
Budding progress in U.S.–China trade talks and a de-escalation between Israel and Iran have lifted risk‐asset demand at the expense of safe havens. FXTM’s senior market analyst Lukman Otunuga observes: With Washington and Beijing agreeing on a trade framework and the Middle East abiding by a ceasefire, investors are rotating back into equities—leaving gold on the defensive.
Despite this seasonal slump, the deeper drivers for gold’s long-term support remain intact. U.S. federal debt recently topped $37 trillion, while M2 money supply has swelled by $1.2 trillion year-to-date. Colombo isn’t worried by the current pullback: We may see further selling pressure, but this correction could set the stage for a year-end rebound.
Indeed, against a backdrop of rising global debt, gold continues to shine as both a currency‐hedge and a safeguard against a weakening dollar—last week’s U.S. Dollar Index closed near a three-year low.
