World gold prices are struggling as a strong profit-taking wave has caused the biggest sell-off in the past 5 years. However, some experts say that this adjustment should not surprise anyone, as there has been a strong price increase this year and over the past 12 months.
Gold prices fell more than 3% on Wednesday as the market responded to US President Donald Trump's soft statements about the US-China trade war and his decision to reverse the US Federal Reserve Chairman Jerome Powell's salary.
Spot gold was traded near $3,281.94/ounce, down nearly 3% on the day. This price is 6% lower than Tuesday's peak of $3,500/ounce.
Although gold is under strong profit-taking pressure, experts emphasize that the long-term uptrend is still intact. At the time of writing (8:30 a.m. on April 24 - Vietnam time), world gold prices recovered strongly, listed on Kitco at $3,359.1/ounce.
In terms of gold outlook, the precious metal has fallen quite a bit in the past few days, but its still just a small decline from the gains its achieved, Fawad Razaqzada, a market analyst at StoneX Group, said in a note on Wednesday.
A strong correction over the past two days means gold has fallen 6.8% from its all-time high to around $3,260/ounce a significant decline. However, the long-term trend is still clear to increase".
Looking ahead, Razaqzada said that if gold tests the support level of 3,100 USD/ounce, he will review the upward trend of gold.
The long-term technical outlook will only turn negative if we start recording lower bottlenecks and peaks. With this, let's look at $2,956/ounce, a key bottom recently before gold sets a new record high.
As long as this level remains strong, any short-term decline should be seen as a buying opportunity, not a signal to look for discount setsups. However, if that level is broken, it would be more reasonable to give up the bullish view, at least in the short term, he said.
David Morrison, senior market analyst at Trade Nation, noted that even at $3,300 an ounce, gold is still considered overbought based on momentum indicators, and may need a deeper correction to correct market sentiment.
We may also see a deeper decline, with $3,000/ounce acting as a more important support level. Such a move could eliminate weak-minded investors, especially those who enter the market late.
If the $3,000 mark holds, allowing the daily MacD index to correct, gold could continue to increase strongly to a new high. However, it is still too early and the form of the correction will be very important when it happens," he said.
The US president has eased some market concerns by announcing a 145% tariff reduction on Chinese imports. He also said on Tuesday that he has no intention of sacking Powell, who is out of office in 2026.
Finance Minister Scott Bessent also reinforced this message when attending the spring meetings of the International Monetary Fund and the World Bank in Washington, D.C., saying that there is a great deal of opportunity for a deal here.
However, he also acknowledged that a comprehensive trade deal could take two to three years to complete.
Although concerns about recession have eased, some experts say the global economy has suffered a lot of damage and restoring confidence in the US as a reliable trading partner will take time. In this context, gold is expected to maintain solid support.
The overall picture is that the underlying driver for reserve assets has changed completely since 2022, and the tariffs have only added to this change, said David Miller, Director of the Catalyst Funds Gold Enhanced Yield ETF (GOLY) portfolio.
The main factor driving this change is central banks. They have purchased more than 1,000 tons of gold in 2023 and 1,060 tons in 2024, and this trend is continuing to increase this year.
I believe that this is a much more important factor than the activities of individual investors or the normal market. In the long term, the main story is that central banks from BRICS countries and emerging markets are replacing their USD reserves with gold."
