Hexun Investment Advisor Wu Zhikai: In the big picture, gold will continue to rise.

Precious metals, especially gold, judging from historical patterns, will most likely go through a process of falling first and then rising. But 80% of people can’t hold onto their chips during this round of turbulence. Recently, many are panicking after gold’s sharp plunge. But let me tell you: today’s decline is fundamentally being driven by sentiment and expectations, not a reversal of the trend.

Before the outbreak of war in February this year, gold was wildly promoted and pushed to a new high of 5,300. After the war started, it directly dived to 4,400, with a decline of 17%. Why?

Because investors buy the expectation and sell the facts, and in addition, oil prices have surged so much that the Federal Reserve doesn’t dare to cut rates, crushing short-term upside. But note that the current panic hasn’t fully played out yet. It’s only in the air-raid phase; the ground war hasn’t begun. Once the ground war breaks out, there will be another wave of sentiment-driven selloffs. But that’s precisely the best opportunity for a washout. Once the conflict drags into a prolonged war, high oil prices will boomerang onto the economy, forcing the Federal Reserve to return to a rate-cutting channel. Precious metals are expected to see a new round of market action. And this time, silver and non-ferrous metals have even greater upside elasticity. Silver fell more than 25% from its peak, smashing down to $68—meaning the shakeout is even more thorough, and the rebound potential is even more terrifying. Copper, aluminum, and other non-ferrous metals may have plunged sharply in the short term—especially London copper, which even fell below $11,700—but the logic that war disrupts supply chains in the medium to long term still provides support on the supply-demand side. Don’t be scared off by short-term fluctuations. Make rational decisions—wait for the ground war to materialize and for the rate outlook to turn. Follow my guidance to see through the underlying logic.

(Editor: Zhang Yang HN080)

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