The market is currently in a macro repricing stage dominated by US dollar trends and the interest rate path. Although gold has experienced a notable correction recently, its overall bull market structure remains intact. The market is repricing rate hike risks for this year on one hand, while on the other hand, it widely expects the next Fed Chair, Kevin Warsh, to adopt a relatively dovish policy stance. This creates significant tension and implies that the current market pricing for the rate path may be unsustainable. Once the market begins to correct these expectations, the US dollar could weaken again, and real interest rates are also expected to fall, thereby reopening the upside for gold.
From a trading signal perspective, quantitative and trend models have recently strengthened simultaneously. Historical data shows that after similar signals were triggered in the past 10 instances, gold's average gain over the following two months was about 12.8%, corresponding to a target price of approximately $5,306, with a historical win rate of about 70%. Meanwhile, the DXY attempted to break the 100 level three times—in July 2025, November 2025, and March 2026—but failed each time, indicating weakening momentum for the dollar's rebound. Against this backdrop, this article views the current correction as more akin to a phase of consolidation rather than a trend reversal.
Repricing of the Dollar and Interest Rates: Gold's Core Thesis Remains Unchanged
For the coming months, the most critical variable for gold will still be the repricing of the US interest rate path. Powell has confirmed the late-April FOMC meeting will be his last as Chair, while the June 17 FOMC meeting will be the first under Kevin Warsh's leadership. Warsh has previously stated on multiple occasions that the productivity boost from AI has deflationary effects, and the market widely expects his policy stance to be more dovish compared to the current one.
However, at the same time, the market has completely priced out rate cuts for this year and has even begun pricing in one rate hike. This pricing logic itself contains a clear contradiction. If the June dot plot begins to counter the current expectation of "one rate hike this year," gold could rapidly repricing. The September 16 FOMC meeting is also seen as a critical window; historically, after rate cuts in September 2024 and 2025, both gold and Bitcoin showed significant rallies.
Simultaneously, US debt expansion and fiscal pressures are strengthening gold's long-term narrative. The current US debt level has reached $39 trillion, an increase of about $2.7 trillion since the passage of the "Big and Beautiful Act" in July 2025. Gold has corrected, but the debt has not shrunk. Once the market refocuses on liquidity and fiscal expansion logic, gold is poised to challenge its historical highs again.
Synchronized Improvement in Technicals and Fund Flows: Gold May Enter a New Upward Phase
From a technical perspective, gold's current structure remains positive. During this correction, gold found significant support in the $4,300-$4,400 range and subsequently established a higher low around $4,500 in early May. Continuously higher lows signify that the bull market structure remains intact. Currently, gold is consolidating within a narrow triangle pattern; an upward breakout could pave the way for a renewed challenge of previous all-time highs.
Historically, gold's long-term trend has advanced in approximately $1,000 increments. Therefore, $5,300 could be a reasonable target for the next phase, while $6,300 might become a potential target for late this year or next. Furthermore, several potential catalysts are approaching in the coming months, including the "Trump–Xi Jinping" meeting in May, the June FOMC, the BRICS summit in July, and the US fiscal cliff in September. As the market begins to reprice the paths for the dollar, interest rates, and liquidity, gold's relative appeal is likely to strengthen further.
Overall, although this gold correction has been significant in magnitude, the trend structure has not been broken. A weaker dollar, repricing of the interest rate path, global reserve diversification, and US fiscal pressures are gradually converging into a new macro resonance. Concurrently, quantitative and trend models have strengthened simultaneously, and multiple key catalysts are set to materialize in the coming months. For the market, the key at this stage is no longer just short-term inflation fluctuations, but when the market refocuses on liquidity and accommodative policy logic. Once this process begins, gold could re-enter a new phase of accelerated gains.
Some of the views above are derived from BIT on Target. Contact us for the full BIT on Target report.
Disclaimer: The market carries risks, and investment requires caution. This article does not constitute investment advice. Trading digital assets can involve significant risk and volatility. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. BIT assumes no responsibility for any investment decisions based on the information provided herein.
