Gold nears interim bottom despite recent correction, says World Gold Council
Gold nears interim bottom despite recent correction, says World Gold Council Photograph: (Credit: AFP)
Gold prices may be reaching an interim bottom, according to the World Gold Council. Read the latest WGC analysis on market trends and recovery signals.
The World Gold Council reports that gold prices are approaching a potential bottom, with overall market conditions favouring a price turnaround despite the recent dip. The council noted that two of the three historical conditions associated with gold price recoveries are already in place.
The WGC said the current decline is more likely to be a correction than the start of a prolonged downturn similar to the one after 2011, as the macroeconomic and fundamental backdrop remains considerably stronger. "Unlike in 2011, the macro backdrop supports a recovery," the report said.
Gold closed October at USD 3,913 per ounce, down 6.3 per cent during the month, with prices falling across all major currencies tracked by the council. The metal is currently about 25 per cent below its January 2026 record high of USD 5,405 per ounce.
The WGC pointed to technical dislocation and dollar strength as signs that the sell-off may be nearing exhaustion. Gold is trading well below its 200-day average, and the dollar has rallied into its top tier, the report said. Speculative positioning, however, remains elevated and has yet to see a complete washout, which the council described as an important condition for a sustained recovery.
The council's analysis of gold bear markets since 2005 found that periods in which at least two of the three conditions were present produced a median three-month forward return of 4.2 per cent, with positive returns in 90 per cent of the observations. When all three conditions were met, gold recorded positive returns in all five historical episodes analysed.
