The expert explained the correction in the gold market after record growth

The precious metals market is ending October with a stage of technical correction that interrupted an almost two-month record rally. This was stated by Alexey Vyazovsky, Vice President of Golden Board, in an interview with Izvestia on October 27.

According to him, since October 2023, gold and silver have shown an increase of more than 150%, with half of this increase occurring in the last eight weeks. After a rapid rise, a natural correction followed — the market experienced the largest sell-off in the last five years with a drop of more than 5% in one day.

"The spot price of gold has consolidated at $4,070 per ounce, maintaining its position above the key support level of $4,000. Silver adjusted to $48 per ounce, which indicates the beginning of a period of healthy consolidation," the specialist said.

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He noted that historical data shows that after such protracted upward series (only four cases in the last 50 years) The median return on gold over the horizon of one to 20 weeks is more often negative, averaging from -3 to -6%.

Despite the short-term negative technical picture, the fundamental factors remain stable. Inflation in the United States in September was 3.0% against the expected 3.1%, which did not change the forecasts for the policy of the Federal Reserve System (FRS). The probability of a rate cut at the next meeting is estimated at 97%, which supports a soft monetary background. The key long-term driver remains the record growth of the US national debt, which exceeded $38 trillion in October, having increased by $1 trillion since August.

Vyazovsky stressed that the current volatility reflects a temporary respite, not a reversal of the global trend. Fundamental factors such as soft monetary policy, rising government debts, inflation and geopolitical risks continue to support the prospects for precious metals. In the short term, gold may test the range of $3,950—4,000 per ounce, while silver may drop to $43-44.

"In the medium term (1-3 months), with the stabilization of macroeconomic indicators, metals will receive support to return to growth. Long—term forecasts remain optimistic: gold has the potential to reach $4,400—5,000 per ounce in the first half of 2026, silver - $52-58," the expert concluded.

Andrey Syrchin, CEO and founder of Cresco Capital, told Izvestia on October 14 that gold is currently one of the most sought-after assets on the market, as it does not generate profits, it is expensive to store and extract, but its value has almost doubled over the past year. He added that the price of gold could rise to $4.5 thousand or even $10 thousand per ounce.

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