Gold Prices Take a Dive—What's Behind the Sudden Drop?

After the market opened, gold prices surged to $2,894.10 per ounce, but then quickly dropped significantly. The price briefly fell below $2,880 per ounce, reaching a low of $2,878.44 per ounce.

From a technical perspective, according to the 60-minute chart, gold prices have broken downward from the ascending channel. After the sharp drop into oversold conditions, the 14-hour RSI also supports a bearish outlook.

Why does gold have safe-haven properties?

Gold, as a precious metal, has been highly valued for thousands of years, not only for its beauty but also for its unique properties, making it an ideal choice for currency, jewelry, and wealth storage. So, what makes gold so special?

Its distinctive qualities—rarity, durability, and resistance to corrosion or rust—make it one of the most sought-after precious metals. Historically, gold was used as the foundation for currency and trade. Even in todays digital age, gold is still considered a reliable safe-haven asset against inflation and economic uncertainty.

Gold prices are influenced by a variety of factors, including global economic conditions, interest rate changes, and geopolitical tensions. When economic uncertainty or inflation rises, investors typically turn to gold as a safe-haven asset. As a result, gold tends to perform well during periods of economic turbulence or market volatility.