Gold is falling, and a bunch of people have started saying gold's all-time high was at 5600. It's really just sentiment. After all, I saw people on X calling bearish from 3500, being ambiguous at 4000, and saying it was a historic top at 5000.

Gold has traditionally been viewed as a safe-haven asset, but with this Iran conflict, gold's performance can't be called a safe haven at all.

The reason comes down to liquidity. Gold currently has the most abundant liquidity among major asset classes. With war expectations priced in, the market is spontaneously liquidating the most liquid assets—this is already a pattern.

For example, after the Russia-Ukraine war broke out, gold pulled back 5% from its high point, with speculative funds taking profits and crude oil surging, pushing up inflation expectations in the background. This Iran war is no exception. Even as of now, gold has gained 10% cumulatively for the year, ranking high among major asset classes, so there's plenty of momentum for profit-taking.

How should we view gold going forward? Setting aside the macroeconomic fundamentals of gold—like central bank gold purchases, anti-inflation assets after inflation spikes, accelerating de-dollarization, etc.—because these fundamental drivers are long-term catalysts.

The main focus should be on current signals in gold. After crude oil broke above $100, in a stagflation scenario, gold's performance significantly outpaced other major asset classes.

The current CFTC net long positioning is no longer crowded. Gold price volatility has declined from highs, gradually returning to a healthier zone. This is the comfort zone for institutional positioning and accumulation. Buying during low volatility is institutional consensus.

Currently, gold's trading logic follows the narrative of high crude oil pushing up inflation and Fed rate hikes. I believe a rate increase in 2026 is impossible. If the US doesn't want a triple kill of stocks, bonds, and currency, the most it could do is pause rate cuts.

Given weak US economic growth, the Fed will tolerate high inflation longer than the market expects. Fiscal monetization is almost inevitable, and they'll continue printing money at full throttle.

When the war ends and rate cuts resume, when stagflation becomes the market narrative, gold will launch another leg up.

Additionally, the hard truth maintaining world order is violence, but the Iran war has exposed some illusions about America. The dollar system grows increasingly fragile. Trump has accelerated gold's rally—this president is truly gold's biggest bull.

Gold breaking below moving averages is not a bearish opportunity, but a great window to gradually build long positions!