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The Gold Rush Hits a Stop Sign: Bulls Catch Their Breath at $4,000

Gold’s record-breaking rally hits turbulence as technical selling, profit-taking, and inflation fears send prices tumbling back toward the $4,000 mark — but bulls aren’t backing down just yet.

Editorial Team (ET)October 22, 2025


In a dramatic turn for the bullion market, gold has tumbled back toward the $4,000 mark after enduring its worst single-day drop in more than a decade. The precious metal’s blistering rally came to a halt this week as traders rushed to lock in profits, triggering a wave of technical selling ahead of crucial U.S. inflation data.

A Painful Pullback After Record Highs

By midday Wednesday, spot gold had fallen about 2% to roughly $4,039.50 per ounce, compounding the more than 6% decline from Tuesday’s rout. U.S. gold futures mirrored the drop, sliding to approximately $4,050 per ounce in New York trading. The sharp retreat follows a historic run that saw bullion shatter records, peaking at $4,380.89 per ounce just days ago.

Despite the pullback, gold remains perched above the psychologically important $4,000 threshold, a level it first crossed two weeks earlier. That ascent was fueled by investors seeking refuge from economic turbulence and ballooning U.S. deficits—a move dubbed the “debasement trade.” But even the most powerful rallies need a breather, and this one has finally hit resistance.

The Mechanics of a Selloff

Suki Cooper, head of commodities research at Standard Chartered, attributes the slump to “technical selling.” In her view, gold had entered overbought territory after its relentless climb since early September. According to Cooper, the bank remains optimistic for 2026, forecasting renewed strength once the market consolidates.

David Meger, director of metals trading at High Ridge Futures, echoed the sentiment, noting that the correction was “not completely surprising.” After weeks of aggressive buying, he said, many traders simply decided to cash in ahead of Friday’s Consumer Price Index report—a potential catalyst for the next big move.

This correction underscores the fragility of momentum-driven markets. When sentiment turns, even slightly, automated trading models and stop-loss triggers can magnify price swings, producing sharp and sudden reversals. For gold, it’s a classic example of the bull run meeting its first real test.





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