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Gold Plunges in Record Decline After Fed Chair Nomination

Is gold's correction a buying opportunity or a warning sign of dangerous market volatility?
Gold Plunges in Record Decline After Fed Chair Nomination
Above: A customer shops for gold jewelry at a gold store in Hangzhou, Zhejiang Province, on Jan. 31. Image credit: Costfoto/NurPhoto/Getty Images

The Spin

Narrative A

The wild instability in precious metals reveal dangerous market movements disconnected from reality. Those who invested at the peak should have seen that bond markets showed no inflation fears, Treasury yields moved opposite to debasement predictions and the dollar's movements contradict the safe-haven narrative. Those who ignored warnings about a 25-35% crash got exactly what they deserved.

Narrative B

Gold's sharp correction was inevitable after an unsustainable melt-up from $3,000 to $5,500 without meaningful pullbacks. However, the structural drivers behind the rally remain intact, including geopolitical tensions, fiscal uncertainty and currency debasement concerns. Investors should view this as a buying opportunity to gradually build positions through a phased approach.

Metaculus Prediction

There is a 50% chance that Gold Futures total price returns will exceed S&P 500 Futures's by at least 1.75% in the Feb. 2-13 period of Q1 2026, according to the Metaculus prediction community.



The Controversies



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© 2026 Improve the News Foundation. All rights reserved.Version 6.18.0

© 2026 Improve the News Foundation.

All rights reserved.

Version 6.18.0