Earlier this week, investors withdrew $1.27 billion from the SPDR Gold Shares ETF, marking the largest single-day outflow since 2011. This coincided with gold prices reaching a historic high above $3,500, suggesting potential profit-taking activities. In 2011, a similar outflow occurred during the last peak of a gold supercycle, leading to a prolonged consolidation period until 2020. However, this does not necessarily indicate a turning point for the market.
Despite the significant outflow, several positive factors continue to influence the gold market. These include trade uncertainties, safe-haven demand, central bank purchases, and further bullish sentiment from Wall Street regarding future spot gold prices. Nonetheless, the recent outflow raises questions about whether the persistent rally seen this year might be losing momentum.
