Recently observing this wave of gold market trends, I am pondering a question: When will gold prices fall? This isn't a simple technical analysis issue; it actually reflects changes in the entire global credit system.

Speaking of why gold has been continuously rising, many still rely on old logic—inflation, rate cuts, safe-haven. But I’ve found that the core driver of this bull market is actually deeper. That critical moment in 2022 broke a long-held assumption that many never questioned: that sovereign assets should be safe. Since then, the attitude of global central banks toward gold has changed.

Last year, global central banks net purchased over 1,200 tons of gold, marking the fourth consecutive year exceeding 1,000 tons. Even more interesting, 76% of surveyed central banks believe they will increase their gold holdings over the next five years, while also expecting US dollar reserves to decline. This isn’t short-term speculation; it’s a structural force reshaping the landscape.

Of course, short-term catalysts are also quite evident. Trade protectionism, tariff policies, geopolitical tensions—these factors can trigger rapid 5-10% surges each time. The Fed’s expectation of rate cuts has also directly lowered the opportunity cost of holding gold. But I’ve noticed a detail: gold prices don’t jump on the day rate cut news is announced; instead, they accelerate when actual rate cuts surpass market expectations.

Global debt has already surpassed $307 trillion, meaning the policy flexibility of various countries’ central banks is increasingly limited. In a high-debt environment, easing policies will become the norm, real interest rates are pushed down, and gold will continue to benefit. Plus, with stock markets already at historic highs, many investors are starting to see gold as a stabilizer in their portfolios.

Regarding when gold prices will fall, my observation is this: there will indeed be corrections in the short term. A significant 18% pullback occurred earlier this year, with very volatile swings. But the long-term bottom is gradually rising, and bear market declines are limited. The real change will only happen when the market generally expects the cracks in the global credit system to be repaired, dollar confidence to be restored, and central banks to stop buying gold. But from the current situation, these conditions are still far off.

Institutions forecast that by 2026, gold prices will fluctuate at high levels, with an average target of $4,800–$5,200, and a year-end target of $5,400–$5,800. Major banks like Goldman Sachs, JPMorgan, and Citibank are all raising their forecasts, citing ongoing central bank purchases, rate cut expectations, and safe-haven demand. UBS even suggests a mid-year target of $6,200.

As retail investors, can we still participate now? I believe there are opportunities, but it’s important to clarify your positioning. Short-term traders can take advantage of volatility around US market data releases for swing trading, but they must set strict stop-losses of 1-2%. Beginners should start small, learn to read economic calendars, and avoid blindly chasing highs. Long-term allocators can consider gold as a diversification tool, but be prepared for a 20% or more correction, as gold’s volatility isn’t lower than stocks.

Experienced investors might consider a combination of long and short strategies: holding core positions long-term, while using volatility for short-term trades. But this requires strong risk control. I especially want to remind that physical gold trading costs are high—5-20% costs can eat into profits significantly, making frequent trading unprofitable. Gold ETFs or tools like XAU/USD have better liquidity and are more suitable for swing trading.

Ultimately, this gold bull market is driven by a long-term adjustment of the global credit system. The trend of central bank gold purchases has not truly stopped since exploding in 2022, due to persistent inflation, debt pressures, and geopolitical tensions. The gold price bottom keeps rising, but the upward trend is never straight. The key is to have a systematic way to monitor these changes, rather than follow news blindly. When will gold fall? It could happen at any time in the short term, but long-term, this trend is unlikely to reverse easily. Clarify your time horizon before deciding how to enter.