Interpretation of the 50-year gold bull market | Reaching new historical highs frequently, is there still room for future growth?

Gold has been a symbol of wealth since ancient times. Due to its high density, corrosion resistance, and ease of preservation, it can serve as currency, be made into jewelry, or be used in industrial applications. Over the past 50 years, gold prices have experienced fluctuations but overall trend upward, especially in 2025, reaching new all-time highs. Will this half-century-long bullish trend continue? How should we interpret gold price movements? Is it suitable for long-term investment or swing trading? This article will answer these questions one by one.

50 Years of Growth: How Did Gold Rise from $35 to $4,300?

The historical turning point for gold prices began in 1971. That year, U.S. President Nixon announced the detachment of the dollar from gold, breaking the Bretton Woods system established after World War II—which pegged the dollar to gold at a rate of 1 ounce = $35. After the detachment, gold entered a truly market-driven era.

From 1971 to 2025, gold prices soared from $35 per ounce to $4,300, a cumulative increase of over 120 times. Notably, during 2024 to 2025, gold performed exceptionally well. In early 2024, gold prices accelerated from around $2,600, with an annual increase of over 104%. Entering 2025, driven by geopolitical tensions, central banks increasing reserves, a weakening dollar, and other factors, gold prices repeatedly hit new all-time highs, breaking the $4,300 mark for the first time in October.

Looking at the 10-year chart of gold prices, it is clear that after 2015, gold entered a new upward cycle. The driving forces behind this rally include global negative interest rate policies, de-dollarization trends, the U.S. QE policies of 2020, the Russia-Ukraine war in 2022, and tensions in the Middle East in 2023, among others.

50 Years of Gold History: Analysis of the Four Major Bull Markets

The gold price trend over the past 50+ years can be divided into four main upward cycles:

First Wave (1970-1975): Confidence Crisis After Detachment
After the dollar was decoupled from gold, public doubts about paper currency grew, leading to increased demand for gold as a safe haven. Gold rose from $35 to $183, an increase of over 400%. Later, the oil crisis erupted, with the U.S. printing more money to buy oil, further pushing up gold prices. After the crisis eased, gold retreated to around $100.

Second Wave (1976-1980): Geopolitical Shocks
Events like the Iran hostage crisis and the Soviet invasion of Afghanistan caused political turmoil and economic crises, with high inflation driving gold from $104 to $850, an increase of over 700%. As crises subsided and the Soviet Union disintegrated, gold prices fell back and stabilized in the $200-$300 range for the next two decades.

Third Wave (2001-2011): Decade of Anti-Terrorism and Financial Crises
The 9/11 attacks triggered global anti-terror wars, with the U.S. significantly increasing military spending. To fund this, the Federal Reserve cut interest rates and issued bonds, leading to a housing bubble. The rate hikes triggered the 2008 financial crisis, prompting the U.S. to implement QE again. During this decade, gold rose from $260 to $1,921, an increase of over 700%. After the European debt crisis in 2011, gold peaked and then gradually stabilized around $1,000.

Fourth Wave (2015-present): Multiple Risks Overlay
Negative interest rate policies in Japan and Europe, accelerated de-dollarization, COVID-19 pandemic-induced QE in 2020, the Russia-Ukraine war in 2022, and tensions in the Middle East in 2023 have all supported gold prices. In 2024, risks from U.S. economic policies, central banks increasing gold reserves, geopolitical turmoil, and other factors have repeatedly driven gold to new highs, reaffirming its role as a core safe-haven asset.

Is Gold Really a Good Investment?｜Return Comparison Analysis

Comparing gold with stocks over the long term:

50-year perspective: Gold increased by 120 times, while the Dow Jones Index rose from 900 to 46,000 points, about 51 times. Gold leads.

30-year perspective: Stocks performed better, with gold second, and bonds the worst.

This shows that gold has long-term competitiveness, but its price movements are not smooth curves. Historically, during 1980-2000, gold traded in the $200-$300 range, and investors who bought then saw no gains. Therefore, gold is more suitable for swing trading rather than pure long-term holding.

Another key pattern is that, even after a bull run ends and prices retreat, each subsequent low point tends to be higher. This reflects the increasing costs and difficulty of gold mining. Investors should understand this pattern to avoid blindly shorting.

Investment difficulty comparison: Bonds are easiest (fixed interest), gold is next (trend-following), stocks are hardest (selecting quality companies).

Overview of Gold Investment Tools｜Advantages and Disadvantages of Five Methods

1. Physical Gold

Buying gold bars or coins directly. Advantages include ease of hiding assets and wearing jewelry; disadvantages are poor liquidity and difficulty in cashing out.

2. Gold Certificates

Similar to bank deposit receipts, recorded in accounts, can be redeemed for physical gold anytime. Advantages are portability; disadvantages include no interest paid by banks, large bid-ask spreads, suitable mainly for long-term holders.

3. Gold ETFs

Better liquidity than certificates, easy to trade. When purchased, you hold shares representing a certain amount of gold ounces. The issuing company charges management fees; if gold prices remain stagnant long-term, the value slowly erodes.

4. Gold Futures and CFDs

Most commonly used by active retail traders. Through margin trading, low transaction costs, and the ability to go long or short. CFDs are more flexible than futures, with higher capital efficiency, especially suitable for small investors and short-term swing traders.

CFD advantages include: 24-hour trading, low minimum deposit (tens of dollars), adjustable leverage (commonly 1:50 to 1:100), minimum trade size as low as 0.01 lots, and fast execution. Investors can profit from rising gold prices by going long (buy), or from falling prices by going short (sell).

5. Gold Funds

Investing in gold through fund companies, managed by professional teams, suitable for investors who are not good at trading.

Asset Allocation Wisdom: Gold, Stocks, and Bonds

The three asset classes have different return mechanisms:

• Gold: Gains from price differences, no interest, focus on timing entry and exit
• Bonds: Income from coupons, need to accumulate units to increase interest income, and adapt to central bank policies
• Stocks: Gains from corporate growth, suitable for long-term holding of quality companies

Allocation principles: During economic growth, favor stocks; during recessions, allocate to gold; throughout, hold bonds for stability.

In prosperous times, corporate profits boost stock prices, while bonds and gold are less favored. During downturns, stocks falter, and gold’s hedging and bonds’ fixed income become safe havens.

Events like the Russia-Ukraine war, inflation, and rate hikes have proven that: Holding a diversified portfolio of stocks, bonds, and gold can effectively hedge volatility and make the investment portfolio more resilient.

Markets are ever-changing. As a symbol of wealth for thousands of years, gold plays a role in protecting assets during uncertain times. Whether for long-term asset allocation or short-term swing trading, understanding its historical patterns and driving factors is key to mastering gold investment.