Core Viewpoint - The gold and silver markets experienced significant declines on October 21, with gold prices dropping sharply due to profit-taking by investors after a recent surge driven by expectations of further interest rate cuts by the Federal Reserve and strong safe-haven demand [7][9][11]. Price Movements - As of October 21, gold prices fell by 6.3%, dropping below $4100 per ounce, with a decline of over $240 in just seven hours [2]. By 11 PM, gold was reported at $4112.37 per ounce, marking a 5.58% decrease, while COMEX futures were at $4145 per ounce, down 4.92% [2]. - Concurrently, silver also saw a significant drop, with London silver reported at $48.18 per ounce, down 8.02%, and COMEX silver futures declining by 7.69% to $47.44 per ounce [4][5]. Market Analysis - Analysts attribute the recent pullback in gold prices to profit-taking after a rapid increase in prices, which was fueled by geopolitical tensions and expectations of monetary easing [7][9]. - The market is currently experiencing a correction phase, with concerns about overbought conditions leading to increased caution among traders [9][11]. - The volatility in gold trading has reached high levels, indicating potential risks associated with overtrading [9]. Future Outlook - The future trajectory of gold prices remains uncertain, with some analysts suggesting that the likelihood of a decline is greater than further increases [10]. - The sustainability of high net-worth individual investors' demand for gold is a critical factor; if this demand diminishes, it may be challenging to maintain current price levels [10]. - HSBC forecasts that gold's upward momentum could continue until 2026, driven by strong central bank purchases and ongoing fiscal concerns in the U.S., with a target price of $5000 per ounce [11]. However, they caution that fewer interest rate cuts than expected could hinder gold's price trajectory [11].