Analysts: Gold Still Has Downside Potential in the Short Term

On March 23, is there still room for gold prices to decline in the short term? Duan Endian, a precious metals researcher at Dayou Futures, believes that there is indeed some downside potential for gold prices in the short term, but this decline is more of a short-term correction rather than the beginning of a downward trend. "From both a technical and funding perspective, the current market is in a phase of repricing the Federal Reserve's policy of maintaining higher rates for a longer period. The rise in U.S. Treasury yields and the strength of the dollar are exerting direct pressure, which may lead gold prices to test key support levels again." "This downside potential is limited," Duan stated, noting that the ongoing geopolitical situation provides solid support for gold prices. If gold prices drop sharply due to interest rate factors, strategic buying will quickly enter the market to support prices. Therefore, in the short term, gold prices are likely to maintain a wide fluctuation pattern with a ceiling above and a floor below. The extent of the downside potential depends on the magnitude of the rise in real interest rates, while support comes from the demand for safe-haven assets and the logic of reconstructing monetary credit.