Institutions: Gold's short-term downside presents a buying opportunity; the long-term bullish logic remains solid.
2026-06-09 10:25:53
Gold prices fell sharply last Friday (June 5), breaking through a key technical support level and showing significant weakness, with short-term downside risks continuing to rise. Multiple market analysts predict further downside potential for gold prices, but institutional opinions are clearly divided. Most professionals believe that short-term fluctuations are a normal technical correction, and the core logic of gold's medium- to long-term upward trend remains unchanged; instead, the pullback presents a good opportunity to buy.
In a market report released Monday, FOREX market analyst Fawad Razaqzada stated that Friday's concentrated sell-off severely damaged the gold price chart, with the price effectively breaking below the 200-day moving average, a key long-term support level. He noted that, referencing historical price action in September 2023, gold prices fell by a cumulative 5% after breaking below this moving average, and the current breakdown is highly likely to continue the weak trend.
Razakzada's analysis suggests that gold prices had consistently failed to hold above $4,500 per ounce, with bullish momentum waning and ultimately triggering a deep correction. The break below key moving averages further accelerated the downward trend. Currently, the primary support for gold is at the long-term upward trend line at $4,230 per ounce. If this level is breached, support below will be extremely scarce, and a move towards the year's low of $4,100 per ounce is highly probable, with the possibility of even testing the important psychological level of $4,000 per ounce.
The market is awaiting the US CPI data to be released on Wednesday. If core inflation remains at a high level of 2.9% year-on-year, it will strengthen expectations of continued high interest rates, boost the dollar and continue to suppress gold prices.
Simon-Peter Massabni, head of business development at XS, is pessimistic about the short-term outlook for gold. He stated that the strong resilience of the US labor market and persistently high inflationary pressures continue to support the Federal Reserve in maintaining high interest rates and driving up the dollar, exerting sustained downward pressure on precious metals. He believes that unless a major geopolitical black swan event disrupts the global financial landscape, and given the high yields on US Treasury bonds and cooling expectations for interest rate cuts, gold will maintain a weak and volatile trend.
At the same time, he clearly stated that short-term negative factors have not changed the medium- to long-term investment value of gold. He believes that the continued diversification of foreign exchange reserves by central banks around the world, the continued increase in gold holdings to reduce dependence on the US dollar, coupled with high global debt, fiscal pressure on major economies, and persistent geopolitical uncertainties, will provide long-term support for gold prices.
In an exclusive analysis, Morton Wealth CEO Jeff Sarti stated that the market need not be overly concerned about short-term gold price fluctuations. He noted that core fundamentals such as the global loose fiscal and monetary policy environment and persistent inflationary pressures have not reversed, and the long-term value preservation logic of gold remains solid.
He added that for investors with insufficient gold allocation, this round of price correction is a good opportunity to gradually build positions, and the core strategy of holding gold assets for the long term does not need to be adjusted.
Overall , gold is currently facing short-term pressure from technical breakdowns and high interest rates, with a clear trend of price fluctuations and corrections. However, supported by multiple factors such as geopolitical risks, central bank gold purchases, and demand for inflation protection, the foundation for a medium- to long-term bull market is solid, and the short-term decline is a healthy adjustment rather than a trend reversal.
Spot gold daily chart source: EasyForex
At 10:25 AM Beijing time on June 9th, spot gold was trading at $43,332.54 per ounce.
The technical indicators have deteriorated across the board, significantly increasing downward pressure on gold prices in the short term.
In a market report released Monday, FOREX market analyst Fawad Razaqzada stated that Friday's concentrated sell-off severely damaged the gold price chart, with the price effectively breaking below the 200-day moving average, a key long-term support level. He noted that, referencing historical price action in September 2023, gold prices fell by a cumulative 5% after breaking below this moving average, and the current breakdown is highly likely to continue the weak trend.
Razakzada's analysis suggests that gold prices had consistently failed to hold above $4,500 per ounce, with bullish momentum waning and ultimately triggering a deep correction. The break below key moving averages further accelerated the downward trend. Currently, the primary support for gold is at the long-term upward trend line at $4,230 per ounce. If this level is breached, support below will be extremely scarce, and a move towards the year's low of $4,100 per ounce is highly probable, with the possibility of even testing the important psychological level of $4,000 per ounce.
The market is awaiting the US CPI data to be released on Wednesday. If core inflation remains at a high level of 2.9% year-on-year, it will strengthen expectations of continued high interest rates, boost the dollar and continue to suppress gold prices.
Institutional opinions are divided; short-term bearish sentiment does not change the medium-term positive trend.
Simon-Peter Massabni, head of business development at XS, is pessimistic about the short-term outlook for gold. He stated that the strong resilience of the US labor market and persistently high inflationary pressures continue to support the Federal Reserve in maintaining high interest rates and driving up the dollar, exerting sustained downward pressure on precious metals. He believes that unless a major geopolitical black swan event disrupts the global financial landscape, and given the high yields on US Treasury bonds and cooling expectations for interest rate cuts, gold will maintain a weak and volatile trend.
At the same time, he clearly stated that short-term negative factors have not changed the medium- to long-term investment value of gold. He believes that the continued diversification of foreign exchange reserves by central banks around the world, the continued increase in gold holdings to reduce dependence on the US dollar, coupled with high global debt, fiscal pressure on major economies, and persistent geopolitical uncertainties, will provide long-term support for gold prices.
The long-term logic remains sound; short-term pullbacks present buying opportunities.
In an exclusive analysis, Morton Wealth CEO Jeff Sarti stated that the market need not be overly concerned about short-term gold price fluctuations. He noted that core fundamentals such as the global loose fiscal and monetary policy environment and persistent inflationary pressures have not reversed, and the long-term value preservation logic of gold remains solid.
He added that for investors with insufficient gold allocation, this round of price correction is a good opportunity to gradually build positions, and the core strategy of holding gold assets for the long term does not need to be adjusted.
Overall , gold is currently facing short-term pressure from technical breakdowns and high interest rates, with a clear trend of price fluctuations and corrections. However, supported by multiple factors such as geopolitical risks, central bank gold purchases, and demand for inflation protection, the foundation for a medium- to long-term bull market is solid, and the short-term decline is a healthy adjustment rather than a trend reversal.
Spot gold daily chart source: EasyForex
At 10:25 AM Beijing time on June 9th, spot gold was trading at $43,332.54 per ounce.
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