Citadel Securities Turns Bullish on Gold for the First Time This Year: Five Major Catalysts Could Trigger a Gold Price Surge

The gold market is regaining upward momentum. Scott Rubner, a strategist at Citadel Securities, has, for the first time since 2026, recommended that investors allocate structural positions in gold, stating that the current precious metals market is presenting “one of the most attractive upside opportunities in months.”

Rubner believes that gold and silver are simultaneously experiencing multiple bullish factors, including a shift in Fed policy expectations, continued central bank gold purchases, quantitative funds remaining in a net short position, bullish signals from the options market, and the possibility that retail funds previously drawn by the AI trading boom may flow back.

In his view, the confluence of various factors is creating a rare resonance, potentially leading the precious metals market into a new upward phase.

Recently, the cooling of the U.S. job market has become an important catalyst driving the rise in gold.

Data shows that U.S. job numbers unexpectedly declined in July, with the previous two months’ new job data also significantly revised downward. The weakening labor market has reduced expectations for further Fed rate hikes, driving the dollar lower and boosting demand for gold.

Currently, gold prices are stable above $4,300/oz, with the latest trading price around $4,355. Last week, gold prices rose over 7%, marking the largest single-week gain since the end of January this year.

Because gold itself does not generate interest, it typically faces pressure in high interest rate environments. However, with the market re-pricing a Fed policy shift, gold’s appeal has clearly increased.

Rubner stated, “The market is currently re-pricing the Fed’s future policy path, and dollar weakness will further strengthen the bullish case for gold.”

In addition to macro factors, the market’s capital structure is also shifting toward gold.

According to Rubner’s analysis, as of August 6, Commodity Trading Advisor (CTA) funds still hold net short positions in gold and silver. While short positions are typically viewed as price-suppressing, if gold continues to strengthen, these positions could become a driver for further upside.

If gold prices continue to break out, trend-following funds may be forced to cover shorts and turn buyers, pushing the market further upward.

Meanwhile, the options market is also sending positive signals. Citadel Securities pointed out that implied volatility in the world’s largest gold ETF SPDR Gold Shares (GLD) is rising, and the put/call skew has reversed to its most extreme level since February this year, indicating investors are increasing their bullish positions.

The silver market is showing similar changes. Volatility and option structure in iShares Silver Trust are also reflecting the market’s re-pricing of upside risk.

Furthermore, ongoing global central bank gold buying remains a solid foundation for gold’s rise. Rubner is particularly focused on the Chinese market, stating that China’s gold purchases are accelerating and driving a revival in global official sector demand.

Official data shows that since December 2024, China has continuously increased its gold purchases. In July this year, the Chinese central bank continued to increase its gold reserves, marking the 21st consecutive month of accumulation, with about 640,000 ounces added in the month.

Recent continuous inflows into Chinese gold ETFs also indicate investors are taking advantage of price adjustments to reposition.

Against the backdrop of rising U.S. fiscal pressures, discussions over the dollar’s credibility, and persistent global geopolitical risks, gold’s attractiveness as a reserve asset is further strengthened.

Rubner believes there’s another potential catalyst in the precious metals market— the return of retail funds.

Over the past year, AI-related assets attracted a large influx of investment, leading to a decline in retail investor attention on gold and silver. However, if the gold rally trend is further confirmed, some capital may flow back into the precious metals market.

“Precious metals were previously marginalized by the AI trading boom, but if upward momentum forms, retail participation could accelerate again,” Rubner noted.

He pointed out that the gold rally from January to February this year has already demonstrated that retail funds can quickly become a significant source of incremental buying power.