After one of the most violent selloffs in modern precious-metals history, gold is roaring back.
Bullion climbed for a second straight session on Wednesday, surging as much as 2.9% and reclaiming levels above $5,000 an ounce, as bargain hunters rushed in following last week’s stunning collapse from record highs. The rebound builds on Tuesday’s powerful 6% jump, signaling that dip buyers are once again testing the waters after panic briefly took over the market.
Even after the plunge, gold remains up about 17% for the year, underscoring just how dramatic — and fast — the recent moves have been. Silver also advanced, while platinum and palladium joined the recovery.
📉 From Mania to Meltdown — and Back Again
Just days ago, precious metals were in free fall.
Gold is still more than $500 below its all-time high set on January 29, but the renewed strength suggests that the worst of the forced selling may be over.
“Forced sales have likely run their course in precious metals,” said Daniel Ghali, senior commodity strategist at TD Securities. He cautioned, however, that the extreme volatility could keep retail investors on the sidelines — at least for now — removing a group that had become increasingly influential during the rally.
That volatility has been nothing short of historic.
Silver recorded its largest daily drop on record, while gold suffered its steepest one-day decline since 2013, abruptly ending a blistering rally fueled by speculation, geopolitical tension, and growing concerns over the Federal Reserve’s independence.
💥 How the Collapse Unfolded
The selloff didn’t come out of nowhere — but its speed stunned even seasoned traders.
Chinese funds and Western retail investors had amassed heavy exposure to precious metals. Leverage poured in through exchange-traded products, while aggressive call-options buying pushed prices higher and faster. When momentum finally cracked late last week during Asian trading hours, the unwind became ruthless.
“As prices fell, dealer hedging flipped from buying into strength to selling into weakness,” analysts at Goldman Sachs, including Lina Thomas, wrote. “Investor stop-outs were triggered, and losses cascaded through the system.”
The damage was especially visible in China. The country’s four largest gold-backed ETFs saw nearly $1 billion in outflows in a single day on Tuesday — the biggest one-day withdrawal on record — just a week after logging historic inflows.
Confidence, at least temporarily, was shaken.
🏦 Big Money Isn’t Giving Up on Gold
Despite the chaos, long-term believers are standing their ground.
Fidelity, which trimmed its gold exposure shortly before the crash, is already looking for a chance to buy back in. “We’re watching closely,” portfolio manager George Efstathopoulos said, signaling that institutional interest hasn’t vanished — it’s waiting.
Major banks remain firmly bullish:
Deutsche Bank reaffirmed its call for gold to rally to $6,000 an ounce
Goldman Sachs warned of “significant upside risk” to its $5,400 year-end forecast
Bank of America expects volatility to stay elevated but says gold’s long-term thesis remains intact
“Gold has a stronger, longer-term investment case than silver,” said Niklas Westermark, BofA’s head of EMEA commodities trading. While position sizes may shrink during turbulent periods, he added, overall investor interest is unlikely to fade.
🌍 Geopolitics Adds Fuel to the Bounce
Beyond technical factors, geopolitics are once again lending support.
Gold caught a bid as tensions between the United States and Iran escalated following the US Navy’s downing of an Iranian drone. While President Donald Trump reiterated that diplomatic talks remain ongoing, markets have been quick to reprice risk — and gold remains a go-to hedge in uncertain times.
📊 Where the Market Stands Now
As of Wednesday in London, bullion was trading higher above $5,000 an ounce, silver advanced, and platinum and palladium also posted gains. The Bloomberg Dollar Spot Index edged up 0.2%, adding another layer of complexity to the metals’ rebound.
🧠 The Bottom Line
Gold’s violent crash may have rattled confidence — but it didn’t break the story.
The rally that drove prices to record highs was built on powerful forces: geopolitical stress, monetary uncertainty, and a global search for protection. Those forces haven’t disappeared.
For now, the easy money momentum is gone. What replaces it could be something sturdier — a slower, more deliberate climb led by institutions that still believe gold’s best days aren’t behind it.
After one of the wildest weeks in precious-metals history, the message is clear:
Gold isn’t done yet — it’s just catching its breath.