Don't rush to refute! First, take a look at the historical data, and you'll understand.
In the past 30 years, there have been 6 interest rate cut cycles, and in 5 of them, the market crashed by more than 15% within 3 months after the cuts.
Is this a coincidence? No, this is the cruel law of the market.
By the end of 2024, the market is abuzz with rumors that the Federal Reserve will cut interest rates in June 2025, leading to a frenzy of gold ETF investments, with gold prices soaring from $2600 to $3000.
And what happened? In March of this year, the Federal Reserve said, "No rate cuts for now," and institutions immediately reduced their holdings slightly, causing gold prices to adjust in response—this is the old routine, setting up early, good news fully priced in, and then they turn around and dump.
In January 2025, Chinese aunties were still buying gold jewelry at high prices of $850-$870, and when the news broke in March, gold prices fell, accounting for brand premiums and processing losses, at least a 10% loss.
April was even more exciting, with Trump threatening to fire Powell, causing gold prices to fluctuate violently, coupled with tariff disputes, and during the Qingming Festival holiday, gold prices dropped from $3300 to $3000, causing many leveraged players to face liquidation overnight?
But later, China stood firm on tariffs, the U.S. backed down, and the world collectively opposed the tariff war, which basically collapsed, leading to a recovery in market sentiment, and gold not only regained its ground but also reached new highs.
History tells us: interest rate cuts are a monetary game played by the White House and the Federal Reserve, and the U.S. holds the largest gold reserves in the world, tightly binding gold prices to monetary policy.
Therefore, keep a close eye on the Federal Reserve's movements, especially the market reactions when the probability of interest rate cuts rises throughout the year.
Remember, don't let your gold position exceed 5-10%, and strictly set stop-losses.
When everyone is shouting, "Interest rate cuts are coming, gold is skyrocketing!"—that is often when the reaping is sharpest.
The truth of capital markets? During a frenzy, the harvesting begins.
Protecting your capital is a thousand times more important than dreaming of getting rich quickly.
The market changes every day, so don't let your mindset get too tense. If you always feel like you're a step behind or are disturbed by market noise, feel free to chat.
