Gold prices experienced their steepest single-day drop in
five years today (Tuesday), as investors booked profits following a
record-setting rally.
Spot gold fell 6.8% to $4,082.35 per ounce, after reaching
an all-time high of $4,381.21 the previous day. US gold futures for December
delivery declined to $4,129.20 per ounce.
Spot Gold Hits Biggest Daily Loss
The recent surge in gold prices, which have risen about 60%
this year, was driven by factors including geopolitical tensions, expectations
of U.S. interest rate cuts, and increased central bank purchases. However, the
strengthening US dollar and improved market risk appetite contributed to the
sell-off.
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The metal is on track for its biggest single-day drop since
April 2013, when prices fell sharply after peaking near $1,670 per ounce amid
concerns about reduced central bank stimulus in the U.S. “Spot gold prices
extend their decline to over -6% on the day, now on track for the biggest daily
decline since April 2013,” The Kobeissi Letter shard at X.
BREAKING: Spot gold prices extend their decline to over -6% on the day, now on track for the biggest daily decline since April 2013.The long overdue gold pullback has finally arrived. pic.twitter.com/xPEKXvF2Lm
— The Kobeissi Letter (@KobeissiLetter) October 21, 2025
Gold Fails Form New Higher High
The gold daily chart shows that the precious metal had been
consolidating near its recent highs. Yesterday, it formed a bullish daily
candle but failed to produce a new higher high. As of writing, today’s candle
has appeared as a bearish engulfing pattern. If it closes below yesterday’s
low, intraday selling pressure could dominate in the near term.
Silver, Platinum, Palladium Drop Significantly Today
Other precious metals also saw significant declines, with
silver dropping 8.4% to $48.06 per ounce, platinum falling 7% to $1,523.30, and
palladium decreasing 6.6% to $1,398.
Goldman Sachs and Bank of America Gold Price Predictions
Despite the recent downturn, long-term forecasts for gold
remain optimistic. Goldman
Sachs has raised its December 2026 price target to $4,900 per ounce from $4,300,
citing sustained ETF inflows and central bank demand. The firm suggests that if
investors shift just 1% of the $57 trillion U.S. Treasury market into gold,
prices could surge to $5,000.
Similarly, Bank
of America projects gold reaching $5,000 per ounce by 2026, with an average
price of $4,400. These projections are based on expectations of continued
central bank purchases and a weaker US dollar.
This article was written by Tareq Sikder at www.financemagnates.com.
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