Gold bounces back from two-week low, silver recovers
Singapore/London — Precious metals regained ground on Tuesday, recovering from a steep, broad-based sell-off triggered by year-end profit-taking. Spot gold rose 0.7% to $4,363.79 per ounce, bouncing from a two-week low hit on Monday. Spot silver outperformed, jumping 3% to $74.41, following its worst single-day loss in over four years.
The pullback came after both metals reached record highs last week, prompting a technical correction. "The earlier run was overextended... which makes precious metals much more vulnerable for leveraged long positions being squeezed," said Kelvin Wong, senior market analyst at OANDA. The retreat pushed key momentum indicators like the Relative Strength Index (RSI) out of overbought territory.
Historic Annual Gains Set Stage for 2026
Despite the recent volatility, 2025 has been a historic year for the sector. Gold has surged 66%, driven by expectations of U.S. Federal Reserve rate cuts, geopolitical tensions, and strong central bank demand. Silver has far outpaced gold with a staggering 154% gain, fueled by its designation as a critical U.S. mineral, severe supply constraints, and robust industrial and investment demand—a dynamic placing it at the center of a modern high-stakes race for resources.
Analysts view the sell-off as a temporary consolidation within a longer-term bull market. Wong forecasts the strategic pivot toward hard assets will continue, setting six-month price targets of $5,010 for gold and $90.90 for silver. The fundamental outlook remains supportive, with traders anticipating further monetary easing in 2026, which typically benefits non-yielding bullion.
Platinum and Palladium Mirror Volatile Pattern
The price action extended across the complex. Spot platinum rose 1.1% after recording its largest-ever single-day drop on Monday. Palladium also added 1.1%, following a 16% plunge. This parallel volatility underscores how the entire sector remains sensitive to swift shifts in market sentiment and positioning, even within a favorable macroeconomic competitive ecosystem.
For investors, the recent decline represents a potential recalibration point. The market's current strategic maneuver of shaking out speculative positions may establish a more sustainable foundation for the next advance, as the core drivers of monetary policy and geopolitical uncertainty remain firmly in place.
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