Gold plunges in biggest one-day drop in over a decade, ending spectacular precious metals rally

Gold futures (GC=F) suffered their sharpest single-day decline in more than ten years, halting the remarkable rally that had driven precious metals to record highs.

Spot gold fell as much as 6%, hovering around $4,105 per troy ounce, marking its largest one-day drop since 2013. Silver (SI=F) also slid more than 8%, posting its steepest loss since 2021.

The sell-off comes amid easing trade tensions between Washington and Beijing, a stronger U.S. dollar, and technical signals suggesting the market had become overbought.

“Gold tried several times to break above the $4,400 level since last Thursday, but met resistance each time,” said David Morrison, senior market analyst at Trade Nation.

According to Morrison, the key question now is whether this slide marks the beginning of a healthy correction after months of exceptional gains.

He noted that the first major support level lies near $4,000, but it’s also possible the decline will be short-lived, with buyers reentering around $4,200.

Last Friday, investors bought the dip after gold briefly slipped 1.5%, a rare pullback during its recent surge that saw both precious metals and equities hit all-time highs in October.

“This is just a bump in the road,” said Tom Essaye, founder of Sevens Report Research, in an interview with Yahoo Finance. “Inflation remains elevated, real interest rates are low, there are ongoing geopolitical risks, and Washington continues to show dysfunction — all of which create a bullish cocktail for gold.”

Since mid-August, gold has climbed 28%, driven by central bank purchases and inflows into gold-backed ETFs, as investors seek protection against trade tensions and fiat currency volatility.

“What could truly break gold’s momentum would be a massive reduction in global debt — which hasn’t happened yet — and lasting peace in the world,” noted Michele Schneider, chief strategist at Marketgauge.com.

Despite the pullback, Wall Street remains bullish heading into next year.
Bank of America recently reaffirmed its “long gold” recommendation, forecasting the metal could reach $6,000 per ounce by mid-2026.
Goldman Sachs raised its target to $4,900 by the end of next year, up from $4,300, while JPMorgan projects gold could climb to $6,000 by 2029.