Are investors expecting a new peak for gold in 2026?

While traders await what surprises the end of 2025 will bring, sharp questions arise about the near-term price trajectory of gold, especially after the yellow metal experienced sharp fluctuations, rising from a peak of $4,381.44 in mid-October to levels of $4,065 by the end of November 2025.

This price turbulence reflects a real market struggle between those seeing a golden opportunity to rise toward $5,000, and others warning of a correction that could bring prices back toward $3,800. What actually determines the path? Is gold truly on its way to breaking new record highs?

Factors Controlling Gold’s Path

1- Global demand and financial institutions

Data from the World Gold Council showed that total demand in Q2 2025 reached 1,249 tons, a 3% annual increase, but the value jumped an astonishing 45%, reflecting strong institutional interest. Gold ETFs alone attracted massive inflows, raising assets under management to $472 billion, a 6% increase from the previous period, with holdings approaching the historical peak of 3,929 tons.

Geographically, North America accounted for over 50% of global demand, with its share exceeding 345.7 tons in the first half of the year, followed by Europe and Asia with smaller shares. This distribution indicates deep institutional interest in the metal as a strategic hedge.

( 2- Central banks and organized demand

Central banks have chosen a clear path: continuous accumulation. They added 244 tons during the first quarter alone, surpassing the previous quarterly average by 24%, and the percentage of banks holding gold increased from 37% to 44% between 2024 and 2025.

Chinese, Turkish, and Indian leadership is clear here: only the People’s Bank of China added over 65 tons for 22 consecutive months, while Turkey increased its reserves above 600 tons. This behavior indicates a genuine desire to hedge emerging economies against exchange rate volatility and rising sovereign debt.

) 3- Relative scarcity in supply

Despite mines achieving a record 856 tons in Q1 2025, this was not enough to bridge the widening gap between supply and demand. Things worsened with a 1% decrease in recycled gold, as owners preferred to hold onto their pieces in anticipation of continued rise.

Mining costs have risen sharply: the global average extraction cost reached $1,470 per ounce ###the highest in a decade###, discouraging rapid expansion. This relative scarcity acts as a natural barrier against sharp price crashes.

( 4- Monetary policies and real interest rates

The Federal Reserve cut interest rates by 25 basis points in October to 3.75-4.00%, and markets are pricing in an additional cut soon. BlackRock’s forecasts suggest the interest rate could fall to 3.4% by the end of 2026 in a moderate scenario.

This trend reduces the opportunity cost of gold )the non-yielding asset###, boosting its appeal. Real yields on 10-year US Treasury bonds fell from 4.6% to 4.07%, levels that support investor appetite for precious metals.

( 5- The dollar and sovereign debt

The dollar index declined by 7.64% from its peak in early 2025 to the end of November, driven by expectations of rate cuts. This weakness makes gold more attractive to foreign investors.

Meanwhile, global public debt exceeded 100% of GDP according to the IMF, prompting investors to seek safe havens away from credit risks.

) 6- Geopolitical pressures

Trade tensions between Washington and Beijing, along with unrest in the Middle East, increased demand for gold as a hedge by 7% annually, according to Reuters. When spot prices approached $3,400 in July, it became clear that any new crisis in 2026 could serve as a strong catalyst for further gains.

What do analysts say about 2026?

HSBC Bank predicted a bold jump to $5,000 in the first half of 2026 with an average annual price of $4,600. Bank of America also raised its forecast to $5,000 as a potential peak, but warned of short-term corrections if profit-taking begins. Goldman Sachs revised its estimate to $4,900, while JPMorgan expected gold to reach $5,055 by mid-2026.

The most common range among analysts extends between $4,800 and $5,000 as a peak, with an average annual price between $4,200 and $4,800.

Will gold experience a sharp correction?

Despite high optimism, caution exists. HSBC rules out a drop below $3,800 unless a major economic shock occurs, but sees a possibility of correction toward $4,200 in the second half of 2026 if investors start taking heavy profits.

Goldman Sachs indicated that prices remaining above $4,800 could put the market to a “price credibility test,” where industrial demand may lack the incentive to buy at these levels. However, JPMorgan and Deutsche Bank agree that gold has entered a new price range that is difficult to break downward, thanks to a strategic shift in investor perception of it as a long-term asset.

Near-term technical outlook

On the daily chart, gold maintains the main upward trendline around $4,050. The $4,000 level is a critical support: if broken with a clear daily close, the target could be around $3,800 ###50% Fibonacci retracement###.

On the upside, $4,200 represents the first strong resistance, followed by $4,400 and $4,680. The RSI indicator remains at 50, a neutral zone reflecting a balance between buying and selling pressure, while MACD confirms the continuation of the upward trend.

The technical outlook suggests continued sideways trading within an upward-sloping range between $4,000 and $4,220 soon, as long as the price stays above the main trendline.

Expected scenarios

Bullish scenario: If real yields continue to decline and the dollar remains weak, gold is poised to hit new all-time highs exceeding $5,000.

Balanced scenario: If inflation stabilizes and confidence returns to financial markets, the metal may enter a long-term stabilization phase around $4,400-$4,600.

Correction scenario: An economic shock or sudden monetary tightening could push prices down toward $4,000-$4,200.

Summary

The equation for gold in 2026 depends on a delicate balance of three drivers: continued central bank buying, low real interest rates, and sustained strong institutional demand. As long as these three elements remain robust, gold will stay supported, and new levels near $5,000 are not just a distant dream but a very plausible scenario.