What next for the gold price?
From Monday’s lows near $4,100, gold has found support at a technically significant level — its 200-day simple moving average, which sits at approximately $4,092. The swift bounce from that level, even before Trump’s announcement provided a catalyst, suggests the market retains sufficient buyers to defend it.
As long as price remains above that average, the longer-term bull trend technically remains intact, and what has unfolded since January could be interpreted as a corrective pullback but not the end of the bull market.
The question is what comes next, and this depends heavily on the resolution (or escalation) of four interrelated variables: the trajectory of real yields, the strength of the US dollar, the scale and duration of the energy shock and asset flows into or out of gold-backed instruments.
Gold’s recovery may take time. If the Iran conflict is genuinely de-escalating, one of the key geopolitical supports for gold weakens, and if the inflationary consequences of the oil shock persist regardless, the macro headwinds remain.
The more constructive case rests on the expectation that the current configuration of high real yields, a stronger dollar and suppressed rate cut expectations will eventually shift. If inflation pressures ease, or if economic weakness forces the Fed’s hand on rates, gold’s relative attractiveness could improve sharply.
Falling yields and dollar weakness are historically among the most powerful tailwinds for bullion. A policy pivot, a worsening of the conflict or evidence that stagflation is taking hold could all serve as catalysts.
Longer term, the structural thesis that drove gold’s 65% rally last year remains largely intact. Central banks continue to buy, geopolitical fragmentation shows no signs of reversing and debt levels in the major global economies remain elevated. Perhaps most importantly, the de-dollarisation trend that has motivated gold reserve accumulation among non-Western central banks has not been unwound. These are multi-year forces, not quarterly ones.
The major investment banks reflect this in their targets. UBS holds a $6,200 per ounce forecast for September 2026. Deutsche Bank has reiterated $6,000 per ounce. Société Générale also targets $6,000 by year-end. Each of those targets implies a recovery of 35% or more from Monday’s intraday lows, consistent with the scale of the swings already seen this year.
As ever, gold is perhaps best viewed as a portfolio diversifier and inflationary hedge. Its role has long been to cushion drawdowns, hedge against fiscal and monetary stress and provide resilience in scenarios where bonds and equities fall simultaneously. Monday’s session, as alarming as it was, does not change that underlying logic.
Of course, past performance is no guarantee of future results.
