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The gold market "has a new script," and the Middle East story has already been wrapped up

Recently, gold has been hovering, and many friends are a bit confused: what exactly is it waiting for? Today, let's clarify that gold is no longer the kind of asset that "relies on Middle Eastern news" as it used to.

Whether it's escalating conflicts or ceasefire negotiations, the market has long since digested these expectations. Looking at Middle Eastern news now and expecting gold to move is like using an expired map to find your way; the direction has already changed.

The real new protagonist: Federal Reserve's Waller's "balance sheet reduction + interest rate cuts"

Now, gold is consolidating, just waiting for signals from the new Fed chair's policies. His combo is like this: balance sheet reduction—targeting inflation, which is bearish for gold, simply put, "pressing it down so it doesn't rise."
Interest rate cuts—supporting the economy, which is bullish for gold, akin to "holding it up so it doesn't fall." The sharp drop in early 2026 was driven by expectations of balance sheet reduction, and the market has already given a warning once.

Short-term (1-3 months): Don't rush to buy the dip
Waller's first move is to restore the Fed's credibility, so policies will lean towards tightening, with balance sheet reduction as the main tone.
Gold is likely to remain volatile and weak; it’s recommended to reduce positions on rallies, patiently wait for opportunities after big drops, and avoid fighting the market.

Medium-term (3-12 months): Two key data points set the direction
The next trend depends on how "interest rate cuts" and "balance sheet reduction scale" play out: if interest rate cuts are ≥3 times and balance sheet reduction stays within 80 billion per month, gold has a chance to rally;
If rate cuts are less than expected and balance sheet reduction exceeds expectations, the sideways and weak pattern will continue.

Long-term (more than 1 year): The big trend is solid, big dips are opportunities, and the long-term bullish outlook is intact ( around the end of 2026 )
High US debt, dollar credibility, global central banks疯狂囤金... these underlying factors haven't collapsed, and the long-term upward trend of gold remains unchanged.
Friends caught in traps, don’t panic; just reduce exposure, buy on big dips in batches, and time will give you the answer.

These are personal thoughts; everyone is welcome to discuss together. $BTC $XAU $ETH #WCTC交易王PK