Castle Securities is bullish on gold for the first time this year, with five key catalysts expected to drive the price of gold into a new cycle.

August 10th. Citadel Securities strategist Scott Rubner has, for the first time since 2026, recommended investors to allocate a gold structural position, believing that the current precious metals market is forming one of the most attractive upside opportunities in months.

Rubner stated that the upward momentum in gold is driven by five resonating factors: the Fed's shift towards expected tightening, global central banks continuing gold purchases, quant fund short covering, the options market releasing bullish signals, and retail funds that previously flowed into AI assets may be returning to the precious metals market.

The recent cooling of the U.S. labor market further strengthens the bullish case for gold. The U.S. employment in July unexpectedly declined, with significant downward revisions to the previous two months' employment data, leading the market to lower expectations for the Fed to maintain its tightening policy, which weakened the dollar and boosted gold demand.

Currently, the gold price is holding above $4300 per ounce, with the latest trading price around $4355. Gold prices rose over 7% last week, marking the largest weekly gain since the end of January.

As of August 6th, commodity trading advisor funds (CTAs) still held net short positions in gold and silver. If the gold price continues to break through, trend-following funds may be forced to cover their shorts and switch to long positions, further amplifying the uptrend.

Furthermore, the options market has also shown positive signals. Citadel Securities stated that the implied volatility of the world's largest gold ETF, SPDR Gold Shares (GLD), has risen, and the put/call skew has reversed to extreme levels not seen since February, indicating an increase in bullish sentiment in the market.

Rubner also emphasized that global central bank gold purchases remain a key support for the long-term rise in gold, especially with the People's Bank of China continuing to increase its gold reserves. In July this year, the Chinese central bank achieved its 21st consecutive month of increasing gold holdings, further boosting official sector demand.

He believes that as U.S. fiscal pressures mount, the debate over the U.S. dollar's credibility heats up, and geopolitical risks persist, the attractiveness of gold as a reserve asset is increasing. If the upward trend is further confirmed, the long-dormant retail funds may re-enter the precious metals market, providing additional momentum to the gold price.