Blanchard Index

Precious Metals

A corrective pullback hit the gold market in late October, tugging the precious metal off its record high. A wave of profit-taking from short-term momentum traders took gold lower after scoring a record-high at $4,373 an ounce mid-month.

Short-term traders cashed out of gold positions amid progress in the U.S.-China trade talks, which decreased safe-haven demand for precious metals. Despite gold’s price pullback, the precious metal remains up nearly 50% this year and is one of the best performing asset classes of 2025.

Long-term investors buy the dip: Bull markets need healthy corrections from time to time to flush out the weak long positions and keep the underlying structure of the uptrend strong. Gold dealers from the U.S. to Singapore have reported a rush of interest in buying gold as prices dropped into late October.

Washington focus: The stalemate to reopen the U.S. government continued into late October. government shutdown entered Day 28 as a cut to SNAP benefits, commonly known as food stamps, looms large in early November with 42 million Americans expected to be impacted.

Mass job layoffs are underway at a number of big U.S. companies. The news is increasing jitters about the stability of the job market.

• Amazon laid off 14,000 workers and said another round could impact a total of 30,000 jobs at the company—this would mark the biggest layoffs in the company’s history.
• UPS also announced major job cuts, slashing 14,000 management jobs and cutting out 34,000 positions in its operational workforce.
• Discount retailer Target announced layoffs that will impact about 8 percent of its corporate staff and said that it will close another 800 open roles.

Stocks staged a rally boosted by positive earnings releases. Nearly 70% of companies that have reported earnings have topped the average revenue estimate. Some of the revenue gains reflect higher prices for consumer products, as inflation remains elevated.

Key Takeaway

There is a major break between Wall Street and Main Street unfolding in our nation. The stock market hit new highs, while mass layoffs are hitting Americans jobs. The long-term trend for gold remains positive. Central banks and individual investors have turned to gold as a safe haven from the so-called debasement trade, in which investors seek to protect and preserve their wealth amid runaway government debt levels.

This week, at the London Bullion Market Association’s precious metals conference in Kyoto, the outlook for gold remains upbeat, with a survey of 106 attendees projecting that gold will be trading at nearly $5,000 an ounce a year from now.