Gold’s bull run this year has trounced even the artificial intelligence trade that drove stocks to all-time highs. The precious metal is now buckling a bit. Futures tied to the precious metal fell more than 1% on Wednesday, one day after plunging 5.7% — the worst daily performance since June 2013. The sudden declines put gold about 8% below the record levels seen earlier this month, when gold broke above $4,300 an ounce and briefly neared $4,400. Despite the downdraft, gold remains perhaps the best trade of 2025. Futures are up about 54% year to date, far outpacing the S & P 500’s 14% advance. The yellow metal has even outperformed some individual AI-related names, such as Meta Platforms and Nvidia . UBS Global Wealth Management strategist Wayne Gordon thinks this sharp correction is due mainly to profit taking. “If we look at adjustments to non-commercial positioning, we believe the decline was largely technical; with slowing price momentum and rising option volatility, more speculative investors decided to take profit,” he said in a note. @GC.1 .SPX YTD mountain Gold vs SPX year to date One wrinkle to the profit-taking theory here is that the debasement trade, in which traders and institutions move away from the U.S. dollar in favor of hard assets such as gold, may be running out of steam. Indeed, the dollar index is up nearly 2% over the past month, outpacing the S & P 500 in the same time. The U.S. currency has also climbed about 0.3% over the past week, while gold is down 3%. “It begs the question as to whether this is starting a new trend or just a quick corrective move,” wrote Andrew Brenner of NatAlliance. “But Central Banks are pretty well stocked with Gold.” Goldman Sachs’ trading desk also noted that spot gold’s realized volatility relative to the S & P 500 hit its highest level since 2020, meaning there may be more wild swings ahead. “Still, from a fundamental standpoint, the key narratives that have driven gold inflows — easing monetary policy, persistent inflation risks, and political uncertainties — persist, like the U.S. government shutdown and the recent spike in tariff-related risks,” UBS’ Gordon added. ( Learn the best 2026 strategies from inside the NYSE with Josh Brown and others at CNBC PRO Live. Tickets and info here . )
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