Global gold market overview: new highs and a sudden reversal

September 2025 marked one of the most volatile periods in the precious metals market. According to Reuters, spot gold broke above $3,800/oz, setting a historic record, fueled by:

• Expectations that the Fed would cut rates in the coming months.

• A weakening U.S. dollar amid the risk of a U.S. government shutdown.

• Rising demand for safe-haven assets against geopolitical uncertainty.

This rapid rally pushed gold close to the $3,900/oz level – a critical psychological resistance. Yet as soon as the price touched this threshold, heavy profit-taking triggered a modest pullback.

In Vietnam, both SJC gold bars and jewelry prices also adjusted, reflecting retail investors’ cautious sentiment once local prices aligned more closely with global levels.

Why did gold reverse at $3,900/oz?

Strong technical and psychological resistance

The $3,900 mark was not just a round number, but also an overbought zone on many technical charts. Numerous sell orders were triggered around this level, intensifying selling pressure.

Impact of U.S. interest rate expectations

Gold yields no income, so its value is highly sensitive to real interest rates. With the Fed yet to provide clear signals on its next rate-cut cycle, some investors trimmed gold holdings in favor of interest-bearing assets.

Short-term profit-taking

After weeks of uninterrupted gains, a correction was inevitable. Institutional investors locking in profits created a necessary “cooling-off” phase in the market.

SPDR Gold Trust – the silent but powerful force

While global gold prices showed signs of cooling, SPDR Gold Trust (GLD) – the world’s largest gold ETF – continued to steadily accumulate physical gold.

• SPDR holds thousands of tons of gold, and every inflow into the fund translates into real demand for physical bullion.

• When investors buy GLD shares, the fund must acquire gold to back them, effectively adding to market demand.

• According to SimplyWall, GLD shares have risen over 43% in the past year, underscoring the strength of institutional demand.

This persistent buying has cushioned gold’s decline, preventing a deeper drop when the market tested the $3,900 resistance.

Drivers that could push gold higher

Fed monetary policy

If the Fed proceeds with significant rate cuts to support the economy, the opportunity cost of holding gold will drop, likely boosting demand.

A weaker U.S. dollar

The U.S. dollar index (DXY) has hit multi-month lows. A weaker dollar makes gold cheaper for international investors, providing an extra tailwind.

Economic and geopolitical risks

From U.S. debt challenges and government shutdown risks to ongoing global conflicts, uncertainty keeps safe-haven demand for gold elevated.

Institutional and ETF flows

Strong inflows into SPDR and other ETFs remain one of the clearest signs that gold demand has not weakened, even during short-term corrections.

Key risks investors must watch

• Fed delays easing: If U.S. inflation resurges, the Fed may postpone rate cuts, removing a major driver for gold.

• Dollar rebound: Strong U.S. economic data could boost the dollar, weighing on gold prices.

• Deep technical corrections: With gold up over 12% in just one month, a 5–10% correction is not out of the question.

• Institutional selling: Should large funds like SPDR shift to net outflows, selling pressure could accelerate.

Strategies for investors

1. Identify support and resistance zones: $3,700/oz may serve as key support, while $3,900/oz remains the critical ceiling.

2. Take partial profits: Locking in gains near resistance levels helps protect returns.

3. Track ETF flows: SPDR Gold Trust activity is a highly reliable sentiment gauge.

4. Diversify portfolios: Gold should act as a defensive hedge, not the entirety of an investor’s holdings. Complementing with USD, bonds, or defensive equities reduces risk.

Short-term correction, long-term upside intact

Gold’s pullback after testing $3,900/oz was a natural reaction to strong resistance and profit-taking. More importantly, SPDR Gold Trust’s consistent buying signals that institutional confidence in gold remains intact.

In an environment where global economic and political risks persist and the Fed edges closer to easing policy, gold is likely to maintain its role as the number one safe-haven asset.

For investors, the lesson is clear: don’t chase every spike, but focus on risk management and holding through the right cycles.