I just noticed something pretty crazy in the markets today. Gold is crashing below $4,350, and people are wondering why gold is falling this way when it would normally rise with all the geopolitical tensions. Honestly, it’s rare to see it like this.

The main reason I’m seeing is the yield on 10-year U.S. bonds, which has risen to 4.40% in recent weeks. When bonds offer higher interest, people prefer that over gold, which doesn’t generate anything. Also, they’ve already forgotten about the rate cuts expected from the Fed, so everything points to a more restrictive monetary policy for longer.

But there’s something more interesting behind it. It seems there’s a strong liquidity problem. When oil prices rose earlier, traders needed cash quickly and started selling gold like crazy. It’s like a mechanical sell-off, not real panic. Gold is very liquid, so it’s always the first to go when markets are stressed. Stop-loss orders got triggered, which sped everything up even more.

The strange thing is that gold keeps falling even when oil has already lost gains and stock futures turned positive. That shouldn’t happen. Some analysts say that probably a big player is being liquidated, causing those sharp drops. There are also liquidity gaps, meaning there are no buyers at certain levels, causing those sudden price jumps you see.

Talking about levels, gold has already fallen more than 14% in the last month. If pressure continues, analysts see support at $4,304, which has held strong. If it drops below that, the next zone would be between $4,270 and $4,200. Although JP Morgan still talks about $6,000+ in the long term, for now the short term looks fragile with these high yields.

Peter Schiff says that all this selling is irrational, that inflation should support gold, but for now markets are nervous. Everything depends on how inflation, interest rates, and liquidity evolve in the coming days. We need to stay alert because a drop in gold today could mean opportunities tomorrow or more pressure if things worsen.