Recently, I've been watching the gold market trend, and I realize that the underlying logic is actually much more complex than just "inflation panic."

To be honest, gold's upward momentum has never been a straight line. I notice that the core driver of this bull market is actually the long-term skepticism worldwide about the US dollar credit system. The 2022 foreign exchange reserve freezing incident completely shook the expectation of sovereignty assets being "inviolable," making gold the only ultimate store of value that cannot be unilaterally frozen. This is not short-term sentiment but a structural shift in confidence.

Central bank actions best illustrate the issue. According to the World Gold Council, by 2025, global central banks will have 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 say they will increase their gold holdings over the next five years, while also expecting a decline in US dollar reserves. This reflects a deeper consensus—countries are quietly de-dollarizing.

Of course, gold price analysis can't rely solely on structural factors. Recent months' volatility also offers food for thought. Expectations of Fed rate cuts, rising trade protectionism, geopolitical tensions—all these are boosting gold's safe-haven premium. Especially around US market data releases, volatility tends to spike noticeably. But these are short-term variables; the real long-term support for gold prices comes from those slow-moving factors.

I've also noticed that the composition of market participants is changing. No longer just traditional long-term allocators, more and more traders are using tools like XAU/USD for swing trading. Liquidity has indeed improved, and reactions are faster, but this also means gold prices will react more intensely to macro signals. Due to Fed policy expectation adjustments in 2025, gold retraced 10-15%, and early 2026, when real interest rates rebounded, saw a sharp 18% correction.

Regarding frameworks for gold price analysis, I think there are several key coordinates worth paying attention to. First is production costs—the total sustaining costs of global mining set the hard floor for prices. Second is the historical percentile; current nominal gold prices have broken previous highs, but after adjusting for inflation, they still lag behind the 1980 peak, leaving room for long-term upside. Lastly, central bank gold purchase trends, especially the actions of major buyers like China and India, are critical signals for whether structural premiums are diminishing.

As for the outlook in 2026, forecasts vary widely among major institutions. Goldman Sachs has raised its year-end target from $5,400 to $5,700, JPMorgan expects $6,300 in Q4, and Citibank projects an average price of $5,800 in the second half. The consensus is a year-end target between $5,400 and $5,800, with optimistic scenarios reaching $6,000 to $6,500. But note that these forecasts are based on different assumptions—some assume continued central bank buying, some consider recession scenarios, others factor in escalating geopolitical crises.

My view is that this gold bull market appears driven on the surface by rate cuts, inflation, and geopolitical risks, but the deeper driver is the cracks in the global credit system. Central bank gold buying has been ongoing since 2022 without pause, as inflation remains sticky, debt pressures persist, and geopolitical tensions continue. The gold price bottom keeps rising, with limited downside in bear markets and strong momentum in bull markets.

For retail investors, there are still opportunities to participate in gold now, but you must clarify your positioning. Short-term traders can use volatility for swing trades, but strict stop-losses are essential. Beginners should start with small amounts to test the waters and learn to track US economic data releases via economic calendars. Long-term investors should be prepared for a 20% or more correction; gold's annual volatility averages 19.4%, which is higher than stocks. Experienced investors can adopt a combined long-short strategy—holding core positions long-term while using volatility for short-term trades.

A reminder: physical gold trading has higher costs (5-20%), and frequent trading can eat into profits significantly. For swing trading, gold ETFs or gold XAU/USD liquidity are better options. The key is to establish a clear analytical framework rather than blindly chasing news or buying high. Follow the trend, clarify your position, and decide your entry approach accordingly.