Weekly Bullish Close for Gold. A Reversal to an Uptrend?

 I previously wrote about a massive correction approaching for Gold. While a significant correction has already occurred, I believed at the time that there was a high probability of further decline. However, considering the current charts and various geopolitical issues, it seems unlikely for prices to drop significantly, even if there is a major correction following the recent rally. Let’s explore the reasons behind this.

1. War : As everyone knows, Gold plummeted recently due to profit-taking after a massive rally, but it remains a fundamental safe-haven asset. When wars and various global issues arise, the demand for Gold inevitably increases.

2. Gold as a Speculative Asset in China : Massive buying by Chinese investors has been a major driving force behind the upward momentum. Although Gold prices have dropped significantly, demand from China remains high. This is partly because the economic situation for ordinary Chinese citizens is poor, and there are few banks deemed reliable enough for their savings. I will provide a link to a relevant article regarding this.
   
   China gold market update: A strong start to 2026
   
   Chinese 'aunties' lead gold buying boom
   
   

3. Nasdaq's Long-term Bearish Trend : Looking at the Nasdaq chart, a continuous downward trend is emerging. There are several factors such as private equity redemption issues, war, a rising dollar, inflation, and increasing unemployment, but the bearish trend is evident from the chart alone. Warren Buffett is also currently holding a record amount of cash. This increases the demand for safe-haven assets like the Dollar and Gold—though a stronger dollar typically makes it harder for dollar-denominated Gold to rise.
   

   
   
   
   Of course, a drop in the Nasdaq doesn't necessarily mean gold will rise. In many cases, they both fall together as investors sell off assets to secure cash. However, I am simply pointing out that the current market conditions for the Nasdaq, where so many global investors are positioned, are quite poor.

4. Gold's Weekly Bullish Close : The weekly candle for Gold has closed with a long lower shadow. After a brief period where a ceasefire seemed possible, investors realized the war would not end easily and began buying Gold as a safe haven. Technically, a bounce occurred at the weekly RSI 50 level. While a short position could be considered if the weekly RSI 50 is breached, that doesn't seem likely at the moment.
   
   

   
   
   
   

We have examined the four reasons above. However, I still believe the possibility of a decline in Gold exists, given the speculative nature of many investments and the monthly bearish trend following a rally not seen in decades. Since Gold is an asset traded by all countries worldwide, caution is essential. As the current chart favors the upside, I plan to wait and see for now. Given the turbulent global situation, please trade carefully. Thank you.

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