If you aren’t buying gold in this correction, you never will, says WisdomTree’s Shah

WisdomTree's head of commodities research, Nitesh Shah, views the recent gold correction from January highs—exceeding $1,000 per ounce—as largely driven by forced liquidations and positioning shifts rather than fundamental macro factors. Shah estimates traditional drivers like bond yields, the dollar, and speculative positioning explain only about $200 of the decline, highlighting that the bulk of the pullback represents a removal of froth rather than a fundamental shift. Shah underscores that such initial price declines are typical around major geopolitical risk events, after which gold typically resumes an upward trajectory. He characterizes current price levels as a rare buying opportunity, suggesting investors who do not buy now may never get another chance. He also expresses skepticism about further aggressive interest rate hikes due to recession risks, expecting central banks to hold steady, which should support gold prices. Looking forward, Shah projects gold could settle near $5,020 per ounce by year-end, with potential upside towards $6,000 if geopolitical tensions intensify. He also highlights the favorable late-cycle macroeconomic environment for commodities broadly, driven by inflation pressures and structural supply constraints, recommending a 15-20% portfolio allocation to commodities to capitalize on ongoing strength. This analysis provides a strong directional view for traders and investors amid an environment of geopolitical uncertainty and macroeconomic complexity, affirming gold's continued role as a strategic store of value and portfolio hedge.