Gold Steadies as Traders Book Profits After Rally to Record

(Bloomberg) — Gold was little changed following a three-day rally that took the precious metal to an all-time high above $4,500 an ounce. Platinum tumbled more than 6%, also retreating from an all-time high touched overnight.

Some traders are starting to take profits as the year draws to a close after a ferocious run in the precious-metals markets that still leaves gold up almost 70% in 2025. Platinum has more than doubled.

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Technical indicators supported the selling. Gold’s 14-day relative strength index was in overbought territory Wednesday, a warning that the price could be due for a pause or pullback.

Gold’s recent run has been driven by its haven appeal amid escalating frictions in Venezuela, where the US has blockaded oil tankers. Traders are also betting the Federal Reserve will lower borrowing costs further next year, which would be a tailwind for non-yielding precious metals.

Gold and silver are both are on track for their best annual performances since 1979. The rally in precious metals has been underpinned by elevated central-bank purchases and inflows into exchange-traded funds. Total holdings in gold-backed ETFs have risen every month this year except May, according to World Gold Council data.

US President Donald Trump’s aggressive moves to reshape global trade — as well as his threats to the Fed’s independence — added fuel to the bull run earlier this year. Investors have also been spurred in part by the so-called debasement trade — a retreat from sovereign bonds and the currencies they are denominated in over fears their value will erode over time due to ballooning debt levels.

“The dominant drivers for both gold and silver right now are the combination of sustained physical demand and renewed sensitivity to macro risk,” said John Feeney, business development manager at Guardian Vaults, a Sydney-based bullion dealer. “We’re seeing momentum reinforced rather than capped, which suggests underlying conviction rather than purely speculative froth.”

Underscoring this demand, gold bounced back quickly after a retreat from its previous peak of $4,381 an ounce in October, when the rally was seen as overheated.

Goldman Sachs Group Inc. is among several banks to predict prices will keep rising in 2026, issuing a base-case scenario of $4,900 with risks to the upside.

Heavy ETF buying has also been a major driver of the latest surge. Holdings in State Street Corp.’s SPDR Gold Trust, the biggest precious-metals ETF, have risen by more than a fifth this year.

What Bloomberg strategists say…

“Precious metals have benefited from easier global monetary policy, while fiscal drift pulled retail buyers back in and dollar diversification kept central banks in a firm bid. More broadly, tight supply plus tariff and geopolitical frictions provided the perfect setup for a banner year in metals.”

— Michael Ball, Macro Strategist, Markets Live. For the full analysis, click here.

Silver traded above $70 an ounce for the first time this week. The metal’s rally has been even more spectacular than gold’s, with its most recent advance buoyed by speculative inflows and lingering supply dislocations across major trading hubs following a historic short squeeze in October.

London’s vaults have seen significant inflows since then, but much of the world’s available silver remains in New York as traders await the outcome of a US Commerce Department probe on whether critical minerals imports threaten national security, which could lead to tariffs or trade restrictions on the metal.

“Unlike previous silver rallies driven primarily by leverage, this move is being underwritten by real demand for metal, which is changing how the market behaves around key price thresholds,” said Feeney. “I can’t see an end to the trend just yet.”

Meanwhile, platinum earlier on Wednesday traded above $2,300 an ounce for the first time since Bloomberg began compiling data in 1987. The metal has been buoyed by tight supplies and historically elevated borrowing costs.

It has gained about 140% this year, the biggest annual increase, according to data compiled by Bloomberg. The latest surge comes as the London market shows signs of tightening, with banks parking metal in the US — similarly to silver — to insure against the risk of tariffs. Platinum is also on course for a third annual deficit this year, due to supply disruptions in major producer South Africa.

Spot gold slipped 0.1% to $4,479.42 an ounce at 3:07 p.m. in New York. Platinum was down 1.4%, while palladium tumbled 7%. Silver edged higher. The Bloomberg Dollar Spot Index was down 0.1%.

–With assistance from Thomas Biesheuvel and Kai Schultz.

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