Saxo Bank: Gold slips below $4,000 as liquidation outstrips ETF buying

Gold is caught between fast-money sellers and steady ETF accumulation, leaving the market finely poised. If long liquidation is nearly exhausted, structural buyers could put a floor under prices, but a clear break below trendline support would probably trigger another round of technical selling. The near-term catalysts are this week's Fed decision and oil prices, because a fresh surge in energy costs that raises rate expectations would increase the pressure. A gold-silver ratio above 74 indicates the market is pricing in risk to industrial demand and broader de-risking, which leaves silver more vulnerable should equities stumble. With speculative positioning already reduced, some of the forced-selling risk has diminished.

Earlier:

• Gold slides under $4,000 in worst week in four months as oil stirs Fed hike fears

Gold trading under $4,000 owes more to positioning than to a change in fundamentals, as speculative money heads for the exits while long-horizon ETF investors continue to accumulate.

Summary:

• Saxo Bank called the drop notable because it occurred as Treasuries rallied sharply, with momentum selling and long liquidation outweighing the typical cushion from falling yields
• Spot gold briefly moved under $4,000 after the $4,060 support level broke on Thursday, accelerating technical selling and leaving it set for the largest weekly decline in months
• Silver dropped to roughly $54, close to an 11-month low, driving the gold-silver ratio above 74, an 11-month high as well
• ETF investors have piled into gold nearly without pause since July, and Saxo Bank sees the pullback as not necessarily undermining the longer-term picture
• Support is seen at an upward trendline close to $3,985, while resistance rests near $4,060 and then $4,230

Saxo Bank attributes gold's move beneath $4,000 an ounce to speculative selling rather than any deterioration in structural demand, saying momentum selling and long liquidation have overshadowed the factors that usually underpin the metal.

In a note, Saxo Bank described the drop as especially remarkable given that it ran alongside a strong Treasury rally. Lower yields would normally provide support for gold, yet selling pressure has dominated this week. After the $4,060 area gave way on Thursday, technical selling accelerated, and spot gold briefly traded under $4,000 in Friday's Asian session. The metal was on track for its biggest weekly decline in several months, and possibly its lowest weekly close since November, even with ongoing geopolitical uncertainty and rising doubts about how long the equity rally can last.

Silver has performed even more poorly, sliding toward an 11-month low around $54. That move lifted the gold-silver ratio above 74, matching an 11-month peak, and points to silver's underperformance as risk is reduced across markets and industrial-demand concerns linger.

Short-term speculative selling is for now outweighing the buying of long-horizon investors, Saxo Bank said. Those investors have added to gold via ETFs almost ceaselessly since July, seeking shelter from fiscal instability, currency debasement and geopolitical risk. ETF holdings have moved back above roughly 100 million ounces, while COMEX speculative positioning has been cut from earlier peaks, according to the bank.

Saxo Bank cautioned that the pullback does not automatically invalidate gold's longer-term investment thesis, but added that it demonstrates how even structurally supported assets can hit sharp reversals when speculative bets unwind.

Attention now turns to whether gold can find its footing. Saxo Bank pointed to an upward trendline drawn from the October 2025 and July 2026 lows, which is currently providing support close to $3,985. The breached $4,060 area could serve as first resistance, with a larger obstacle near $4,230 beyond it. For a sustained rebound, the market would need more stable energy prices, continued central-bank and ETF buying, and signs that the latest stretch of long liquidation has ended.