🟡 Gold suffered its sharpest one day drop since 1985 on January 30, a “Black Friday” for precious metals that rattled markets and sparked fresh debate about whether the gold rally has run too far, too fast.
📉 The sell off came right after Donald Trump nominated Kevin Warsh as the next Fed chair, a figure markets see as strongly hawkish. His preference for shrinking the Fed balance sheet points to higher Treasury yields, a stronger dollar, and tougher conditions for gold.
🌍 Geopolitics has made gold more speculative than usual. Tensions involving Venezuela, Iran, Greenland, and US tariff threats have pushed gold volatility to its highest level since 2008, even briefly making it more volatile than Bitcoin.
📈 Despite the crash, Wall Street has not given up on gold. Deutsche Bank still targets $6,000 per ounce in 2026, while JP Morgan expects that level in the second half of this year as investor demand builds. ETF holdings surprisingly stayed steady during the sell off.
🔮 What happens next? A burst bubble could send prices back toward $2,000 to $3,000, but central bank buying and ongoing geopolitical risk may keep a floor under the market. A stronger dollar, however, remains a major headwind for precious metals.
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