Is gold headed for a peak? 2026 forecasts between $5,000 and a correction

Metals collide with a strong psychological barrier in 2025, as their movement raises inevitable questions about their next trajectory. As 2026 approaches, investors are asking: When will gold go down? Will markets experience a genuine correction or continue to rise?

The Crazy Journey of Gold in 2025

The story of gold this year began with an unusual acceleration. Prices broke through the $4,300 per ounce barrier in mid-October, but quickly retreated toward $4,000 in the following month. This volatility reflected a struggle on the ground between strong buying forces and increasing selling pressures.

The annual average settled near $3,455 per ounce, yet the peak recorded in October exceeded all previous expectations. Data shows that exchange-traded gold funds accumulated assets exceeding $472 billion, with holdings rising to 3,838 tons — very close to the all-time high of 3,929 tons.

Factors Supporting Continuous Rise

Investment demand keeps going

Global demand for gold reached 1,249 tons in Q2 2025, a 45% increase in value. This number didn’t come out of nowhere — new investors found a refuge in the yellow metal, with 28% of new investors adding gold to their portfolios for the first time.

Central banks buy aggressively

Data shows that 44% of central banks worldwide now hold gold reserves, up from 37% in 2024. China alone added more than 65 tons in the first half, while Turkey’s reserves surpassed 600 tons. This institutional buying is a strong pillar supporting gold prices.

Limited supply deepens the gap

Mines produced 856 tons in Q1 — a record number — but only increased by 1% annually. The real issue is that extraction costs have risen to $1,470 per ounce — the highest in a decade. This means production will remain limited as long as costs stay high.

Investment Bank Outlooks: Where is gold headed in 2026?

Major institutions largely agree:

• HSBC: expects gold to reach $5,000 in the first half of 2026, with an annual average of $4,600
• Bank of America: also raised its forecast to $5,000 as a potential peak, with an average of $4,400
• Goldman Sachs: adjusted its forecast to $4,900, relying on strong inflows into gold ETFs
• J.P. Morgan: predicts reaching $5,055 by mid-2026

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

Monetary Policy: The Key Ally

The Fed cuts rates

The Federal Reserve cut interest rates by 25 basis points in October to a range of 3.75-4.00%. Markets are pricing in an additional cut of 25 basis points in December 2025. BlackRock’s forecasts suggest the Fed may target 3.4% by the end of 2026.

This decline in interest rates reduces the “opportunity cost” of holding gold — an asset that pays no interest — increasing its attractiveness.

Double weakness of the dollar and yields

The dollar index has fallen 7.64% from its peak since early 2025. US 10-year bond yields have dropped from 4.6% to 4.07%. This double decline makes gold even more attractive, especially to foreign investors.

Risks and Factors That Could Halt the Rise

Imminent correction?

HSBC warned that momentum might lose some of its strength in the second half of 2026, with potential correction toward $4,200. Goldman Sachs warned that sustained prices above $4,800 could put the market to a “credibility test.”

However, J.P. Morgan 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.

Geopolitical tensions are a double-edged sword

Trade conflicts and regional tensions have increased demand for gold by 7% annually. But any political settlement could reduce this support.

Technical Analysis: Neutral Signals Currently

Gold closed trading on November 21 at $4,065. Indicators show:

• RSI (Relative Strength Index): steady at 50 — a neutral state with no clear bias
• MACD: the signal line remains above zero — confirming continued upward trend
• Key levels: support at $4,000, first resistance at $4,200

The $4,000 level is a critical point — breaking below could lead to a move toward $3,800 (Fibonacci 50%), but staying above suggests continued rise toward $4,400.

Gold Outlook in the Middle East

( Egypt Forecasts indicate the ounce price could reach about 522,580 EGP, an increase of 158.46% over current prices.

) Saudi Arabia and UAE If the optimistic scenario ###$5,000 per ounce### materializes, it could translate to:

• Saudi Arabia: approximately 18,750-19,000 SAR
• UAE: approximately 18,375-19,000 AED

These figures assume exchange rates remain stable and global demand continues.

When Will Gold Really Drop? The Bottom Line

Brief answer: It may not fall much before 2026 unless a real economic shock occurs.

The supporting factors — (interest rate cuts, dollar weakness, central bank buying, limited supply) — far outweigh the pressures. The primary scenario points to continued rise toward $4,800-$5,000, with short-term corrections rather than sharp declines.

But investors should prepare for:

• Potential profit-taking at high levels
• Corrections toward $4,200-$4,400 before a new rally
• Not breaking below $3,800 except in exceptional cases

Today’s gold is not just a refuge — it’s a growing investment asset reflecting investors’ concerns about the economic future.