# Let's Talk About Gold

Gold has fallen more than 24% from 5,400 at the end of February this year to a low of 4,098. In late March, there was a sharp plunge (a record single-week decline), and now prices are rapidly recovering, showing a "roller coaster" market. During previous livestreams, I mentioned that as long as gold breaks below the 5,000 level, you could short it freely. The drop to 4,098 was an exaggerated decline for gold, especially considering people were still buying gold above 5,000...

Many people don't understand the underlying logic. The main reasons for gold's sharp decline in this round are:

1. The Fed's hawkish policy shift, with rate-cut expectations completely shattered

2. Strong US dollar + US Treasury yields skyrocketing

3. Middle East conflict (US-Iran war) causing crude oil prices to surge

4. Long leverage accumulation leading to forced liquidations

These events caused the gold market to crash and triggered significant liquidations among bulls.

From the current market perspective, the Fed will likely maintain high interest rates with expectations for only one modest rate cut. Gold will likely oscillate between 4,300-4,800. However, I believe once prices approach 4,000 again, you can gradually start buying. Fed policy is gold's biggest "bear catalyst."