In the April metal outlook report, Mr. Mike McGlone - senior market analyst at Bloomberg Intelligence - said that gold is facing a major obstacle, stemming from the excessive speculative increase at the beginning of the year.
He said: "At the end of February, this metal jumped to its highest ever level against the Bloomberg Spot Commodity Index, and recorded the largest difference against the 60-month moving average since 1980.
Our point of view is that the vertical increase in gold in 2025 - the strongest year of increase since 1979 - partly foreshadowed the war in Iran, and the peak in 2026 may reflect the 1980s period. The peak at that time, about 850 USD/ounce, was not overcome until 2008.
According to Mr. McGlone, gold continues to face difficulties as speculative momentum has turned this precious metal from a safe haven asset into a risky asset. He noted that gold's 180-day volatility is currently more than double the S&P 500 index and is at its highest quarterly level since 2006.
Mr. McGlone's cautious view of gold was given in the context that this precious metal is heading towards its strongest monthly decline since the 1980s. The nearest spot gold price was traded at 4,612.7 USD/ounce, down 12.5% in the month.
Along with gold, Mr. McGlone believes that the increase in silver to 120 USD/ounce in January could also be a historic peak. He said that the ratio of silver to oil and copper has reached record highs in the first quarter of 2025.
Although not too optimistic about precious metals, Mr. McGlone also emphasized that the ongoing war with Iran continues to create great uncertainty. According to him, the direction of the price will depend on how this conflict unfolds.
He said: "A prolonged conflict or a ceasefire could keep gold prices above 5,000 USD/ounce, but if signs of Iran's decline in offensive capabilities appear and the strait is guaranteed to be safe, the price may be under pressure to adjust back to the 4,000 USD/ounce zone.
