Gold prices, like most financial instruments, are experiencing extreme volatility swings. Friday's trading session marked the worst performance for the precious metal in 2025, with losses reaching 2.5%. While bears attempted to extend losses today, their momentum waned as prices approached the 3,000 level. Gold buyers have been waiting for a full-fledged correction for almost a month and a half and are finally ready to open long positions. If the metal holds above the 3,000 level, a rebound to 3055 is very likely.
Despite its significant decline, gold is holding up remarkably well as a safe-haven asset given the current turbulent conditions. The metal remains within 5% of its all-time high, while other financial instruments have suffered much more serious losses. Chris Vecchio of Tastylive.com notes gold looks particularly attractive as the dollar weakens sharply. The precious metal prices and the greenback typically have an inverse relationship—a dynamic likely to regain market attention soon.
Neil Welsh of Britannia Global Markets sees no reason for traders to lose interest in gold. The events of the last days caused panic selling of all possible assets due to liquidity shortages, but there are no other compelling reasons to ditch the precious metal. Once conditions stabilize, demand for gold is likely to rebound quickly. The catalyst for such a recovery could be the upcoming release of US inflation data for March, due out on Thursday.
Meanwhile, central banks remained undeterred by gold’s record-high prices in March. According to the People’s Bank of China, it added 90,000 ounces of the precious metal in the first month of spring, extending its buying spree to five consecutive months. Analysts at Bloomberg suggest that China’s central bank, along with its global counterparts, are likely to take advantage of the current price dip to further boost their gold reserves.
As long as prices hold above the 3,000, the odds favor a rebound toward 3,055 rather than further decline.
Consider the following trading strategy:
Buy gold at the current price. Take profit – 3055. Stop loss – 3000.
This content is for informational purposes only and is not intended to be investing advice.
