(Kitco News) - Gold experienced a session of extreme whiplash on Monday, March 23, 2026, as the market reacted to a series of high-stakes geopolitical and macroeconomic shifts. The metal plummeted toward $4,100 an ounce at the market open - hitting a session low of $4,098.60 - marking its steepest weekly decline in more than 40 years.
While the metal staged a violent V-shaped recovery to the $4,450 level following President Donald Trump’s announcement of a five-day pause on Iranian energy strikes, Gareth Soloway, chief market strategist at Verified Investing, warns that the recovery may be temporary. According to Soloway, the real catalyst behind the initial rout was not just the war headlines, but a brewing crisis in the $2 trillion private credit market and a "yield shock" in the bond market.
The $2 trillion credit squeeze and margin calls
Soloway identifies a shift in gold’s character, noting it has begun behaving like a risk asset rather than a traditional safe haven. This shift comes as severe cracks form in the $2 trillion private credit market.
In mid-March 2026, major alternative asset managers began "gating" investors to preserve stability. Morgan Stanley’s North Haven Private Income Fund met only 45.8% of redemption requests, strictly enforcing a 5% quarterly cap after withdrawal requests surged to nearly 11%. Similarly, the Cliffwater Corporate Lending Fund faced redemption requests for roughly 14% of its net asset value, opting to meet only half of those requests.
Soloway warns that these liquidity constraints are triggering cross-asset liquidations as investors face margin calls. “All of a sudden they're down 20 plus percent on their positions and that can create margin calls,” Soloway told Kitco News. To cover these liabilities, investors are being forced to sell liquid assets like gold. “Those players have to be wiped out... before it resumes its north trajectory,” he added.
The bond market dictating U.S. policy
The gold market’s morning plunge coincided with a sharp move in the 10-year Treasury yield, which jumped to 4.2% and approached a critical 4.5% threshold. Soloway argues that this "yield shock" - the equivalent of a 50-basis-point rate hike by the Federal Reserve - is what actually forced the administration’s diplomatic pivot.
“I think the bond market's in play here and actually dictating policy,” Soloway explained. He noted that as yields rose, the administration moved to walk back strike threats through "very good and productive" conversations with Iranian officials in Islamabad, led by Steve Witkoff and Jared Kushner.
Silver's brutal correction and $50 target
Silver has faced an even more aggressive technical breakdown, falling for four consecutive sessions and losing nearly 20% from its March highs. On Monday, spot silver tanked to an intraday low of $60.89 - about half of its all-time high posted just eight weeks ago.
Soloway remains cautious on the white metal, noting that silver is currently "more oversold" than gold but remains in a bearish consolidation pattern known as a "bear flag". While the $70 level has held for the third time in 2026, Soloway’s technical framework targets a potential move toward $50 to $54 per ounce before a durable bottom is found.
The washout phase and the 'Phoenix effect'
Despite the short-term pain, Soloway maintains his gold downside target of $3,500 an ounce—a level he views as a "scene of the crime" revisit of the April 2025 resistance-turned-support. He describes the eventual recovery as the "Phoenix effect," similar to the rapid rebound seen following the 2020 liquidity crunch.
“My guess is $3,500-ish... it won't last very long and we will be back towards $5,000 within three to six months,” Soloway predicted. He believes the current washout is a prerequisite for a longer-term move toward $10,000 gold as the "debasement trade" returns to focus.
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