Gold: Wave 4, or Wave 4 of Something Much Bigger?

Gold fell about 25% to around $4,000, and the easy read is that gold broke. It didn’t. The plumbing did. Three of the four pillars that held the market up have cracked this year — the fourth, the one nobody trades on the Fed, is the only reason a correction hasn’t become a rout — and the chart now poses a sharp forward question the structure can’t fully settle.

Back in late May we flagged gold’s first wave down — a textbook correction off the early-year top, GLD pinned to the lower rail of a tight channel. That wave has now extended into a full structural reset. GLD — which holds bullion and tracks roughly a tenth of the spot price — closed at 369.46, down 11.4% on the month and about 28% off its wave-(3) peak near $510.

Three pillars cracked

The four pillars that built the bull have split cleanly into three that reversed and one that held. The contrast is the whole story.

Pillar	2023–24 build-up	Mid-2026 reality
Indian physical	A steady floor under baseline global demand.	Reversed. A May import-duty hike from 6% to 15% to defend the rupee; the World Gold Council reads it as removing roughly 10% of annual demand.
Chinese retail	Heavy buying; Shanghai traded at a premium to London.	Reversed. Physical demand is exhausted; by June the premium had compressed into a discount.
Western hot money	Accumulating ahead of anticipated Fed cuts.	Reversed. After the hawkish Warsh pivot, global gold ETFs bled about $2 billion in May.
Central banks	Record, price-insensitive buying.	Intact. 244 tonnes in Q1; the PBOC added 10 more in May, a 19-month streak.

India, China and the Western ETF complex were the price-sensitive marginal buyers — the ones who chase the trend up and abandon it on the way down. Losing all three at once is what left the metal with no demand cushion underneath the move.