I just reviewed the movements of gold and the situation is quite tense. In a few hours, it lost more than one trillion in value, dropping below $4,350. The interesting thing is that no one expected this because gold fell today despite all the geopolitical tensions happening in Iran. Usually, in such crises, gold rises, but this time the opposite is happening.

The main reason is that U.S. bond yields have risen to 4.40% in recent days. When bonds yield more, people prefer those assets instead of gold, which does not generate interest. Additionally, the Federal Reserve no longer talks about rate cuts, so markets expect a more restrictive monetary policy for longer.

Another important factor is forced liquidity. When oil prices rose, many traders needed cash to maintain their positions, so they sold gold quickly. It was mechanical, not panic. Stop-loss orders also accelerated the fall because as gold dropped in a cascade, automatic sales were triggered.

The strange thing is that gold continued to fall even when oil stabilized and stocks recovered gains. This suggests that a large player is being liquidated. Some analysts mention that there are illiquidity pockets in the market, causing these sharp drops without much support.

Regarding levels: gold has already fallen more than 14% in the last month. If it drops below $4,304, it could go to $4,270 or even $4,200. But if it manages to stay above that level, it could recover with some momentum.

The long-term outlook remains bullish (J.P. Morgan talks about $6,000+), but in the short term, everything depends on how bond yields and liquidity evolve. Some, like Peter Schiff, say the sell-off is irrational because inflation should support gold, but for now, markets are nervous.