Gold’s recent recovery from a mid-year slump and a series of supportive factors suggest the metal’s longer-term bull trend may still be intact, with technical, seasonal, and central bank buying all pointing towards further gains in the coming months.
Gold has spent much of this year frustrating investors, but the picture has started to improve. After surging to a record in late January, the metal fell sharply for months and at one point had lost more than a fifth of its value. Since the late-June low, however, the price has rebounded by about 14%, and the market structure now looks more constructive.
According to the World Gold Council, gold had a strong run in 2024, rising 25.5% and setting 40 record highs as central bank buying, geopolitical risk and weaker dollar and yield conditions all supported demand. Its mid-year review also noted that gold held above $2,300 an ounce for much of the second quarter despite elevated interest rates. That backdrop matters because it suggests the metal has already shown it can absorb restrictive monetary conditions when other buyers stay in the market.
One reason analysts are turning more upbeat is technical. The recent decline appears to have returned gold to a former breakout zone, where buying interest has re-emerged. In market terms, that kind of retest often signals that a bull trend remains intact rather than broken. Seasonal patterns also tend to favour gold from the second half of August onwards, with many historical studies showing a stronger run into the autumn.
Positioning data add to the case. The managed-money segment of the futures market , mainly hedge funds and other large speculators , trimmed bullish bets during the correction, but not dramatically. That suggests there was no full-blown capitulation. At the same time, central banks remain the most important structural buyers, and the World Gold Council has repeatedly highlighted their influence on prices. Goldman Sachs has also argued that China’s actual purchases may be higher than the official figures indicate, possibly including buying via the London over-the-counter market.
More broadly, gold still represents only a small slice of global wealth. The World Gold Council has estimated that privately held gold accounts for about 2.7% of worldwide financial assets. If that share rises even modestly, it could create substantial new demand. Taken together, the technical rebound, seasonal strength, resilient speculative positioning and persistent central bank buying all point to the possibility that gold’s latest slump may have been a pause rather than the end of the longer-term trend.
Disclaimer: This article is intended to inform and educate, not to recommend or endorse any financial product, investment or strategy. Please consider your own financial circumstances and seek professional advice where appropriate before making financial decisions.
