The gold path towards 2026: Will it encounter new highs or an inevitable correction?

Gold experienced a major turning point in 2025, achieving historic jumps reaching $4,300 per ounce in October, then retreating back toward $4,000 by November, sparking a wave of questions about the trajectory of gold prices in 2026, and whether gold price forecasts 2026 will see deeper breakthroughs toward $5,000 or face strong corrections.

It is clear that these movements stemmed from complex factors: concerns over global growth slowdown, central banks gradually returning to accommodative policies, and increasing demand for safe-haven assets amid uncertainty over sovereign debts. However, understanding gold price forecasts 2026 requires a deep comprehension of how these variables will interact in the coming months.

Supply and Demand: Is the Gap Widening?

Data from the World Gold Council tell a completely contradictory story. In the first half of 2025, total demand reached 1249 tons in Q2 alone, up 3% annually, while the value rose to $132 billion, a jump of 45%. Exchange-traded gold funds absorbed massive inflows, pushing their managed assets to $472 billion and holdings to 3838 tons, up 6% from the previous quarter, approaching a historic peak at 3929 tons.

The problem is that supply has not kept pace with this demand momentum. Mine production reached only 856 tons in Q1, a slight increase of 1% annually. Additionally, recycled gold declined by 1% as holders chose to hold onto it expecting further rises, deepening the supply-demand gap significantly.

Mining costs also increased, with average global extraction costs reaching $1470 per ounce mid-2025, the highest in a decade, limiting production expansion and supporting higher prices. This widening gap between supply and demand is one of the strongest indicators that gold price forecasts 2026 may lean toward continued upward movement rather than decline.

Central Banks: The Largest Buyer Still Not Stopping

Central bank activity was not random. During Q1 2025 alone, central banks added 244 tons of gold, a 24% increase over the five-year quarterly average. China, leading the buyers, added more than 65 tons in the first half alone, continuing this trend for the twenty-second consecutive month. Turkey increased its reserves to more than 600 tons, and India was not behind.

Most importantly, 44% of central banks worldwide now manage gold reserves, compared to 37% in 2024. This reflects a genuine strategic shift toward diversification away from the US dollar amid growing concerns over sovereign debt.

The World Gold Council forecasts that central banks will remain the primary driver of demand through the end of 2026, especially in emerging markets (China, Turkey, and India), which need to protect their local currencies. This strongly supports bullish gold price expectations in 2026.

Global Monetary Policies: The Critical Convergence Point

Gold price forecasts 2026 cannot be separated from the directions of major central banks. The US Federal Reserve cut interest rates in October 2025 by 25 basis points to 3.75-4.00%, the second cut since December 2024. Markets are currently pricing in a third cut of 25 basis points at the December meeting.

Some Fed officials, like Michelle Bowman, expect two more cuts before the end of 2025 driven by labor market weakness. BlackRock reports suggest the Fed might target an interest rate of 3.4% by the end of 2026 in a moderate scenario.

This decline in real bond yields will reduce the opportunity cost of holding non-yielding assets like gold, boosting its appeal as an exceptional hedge. But caution is essential: these forecasts depend on inflation stability and labor market responses, both uncertain factors.

The European Central Bank and Bank of Japan are also moving toward easing policies, weakening local currencies and lowering real yields, all of which favor gold as a global safe haven.

Geopolitical Indicators and Currency: The Hidden Driving Force

Indicators do not diminish the importance of geopolitical factors. Middle East tensions and trade disputes between the US and China increased demand for gold by 7% annually in 2025, according to Reuters. When tensions over Taiwan escalated and energy supply fears grew, spot prices jumped above $3400 in July, then surpassed $4300 within a few months.

On the other hand, the US dollar index declined by about 7.64% from its peak in early 2025 until November 21, driven by rate cut expectations. US 10-year bond yields fell from 4.6% in Q1 to 4.07% on November 21. This dual decline in the dollar and yields directly supported institutional demand for gold.

Bank of America analysts see that continuation of this trend could support gold price forecasts 2026, with real yields stabilizing near 1.2% and continued dollar pressure, potentially placing gold in a sustainable upward range.

Where Will Gold Prices Stabilize in 2026?

Major analyst forecasts form a clear roadmap, albeit with variations:

HSBC Bank expects gold to surge toward $5,000 per ounce in the first half of 2026 with an annual average of $4,600, compared to an average of $3,455 in 2025.

Bank of America raised its forecast to $5,000 as a potential peak with an average of $4,400, warning of possible short-term corrections if investors start taking profits.

Goldman Sachs adjusted its forecast to $4,900 per ounce, expecting stronger inflows into gold ETFs and continued central bank buying.

J.P. Morgan projected gold reaching $5,055 by mid-2026, even though the price already exceeded its 2025 targets in Q4.

The most common range among top analysts extends between $4,800 and $5,000 as a potential peak, with an average between $4,200 and $4,800 for the entire year.

The Downside Scenario: Will Gold Break Its Supports?

But warnings should not be ignored. HSBC itself warned that the bullish momentum might weaken in the second half of 2026, with a correction toward $4,200 if investors start profit-taking, though it excluded a drop below $3,800 unless a real economic shock occurs.

Goldman Sachs warned that sustained prices above $4,800 could put the market to a “price credibility test,” challenging gold’s ability to maintain high levels amid weak industrial demand.

However, J.P. Morgan and Deutsche Bank analysts agree that gold has entered a new price zone that is difficult to break downward, thanks to a strategic shift in investor perception of it as a long-term asset rather than just a short-term speculative tool.

What Does Technical Analysis Say?

Based on daily technical analysis, gold closed on November 21, 2025, at $4,065.01, after touching a high of $4,381.44 on October 20. The price broke below the ascending channel on the daily chart but remains attached to the main short- to medium-term upward trendline around $4,050.

Critical levels:

• First support: $4,000 (Break to determine continuation of correction)
• Second support: $3,800 (50% Fibonacci retracement)
• First resistance: $4,200
• Second resistance: $4,400
• Third resistance: $4,680

The RSI indicator remains at 50, indicating full market neutrality. The MACD line stays above zero, confirming the overall bullish trend. The technical outlook suggests continued sideways trading within an upward-sloping range between $4,000 and $4,220 in the near term, with the overall picture remaining positive as long as the price stays above the main trendline.

Gold Price Forecast 2026 in Local Currencies

In Egypt, CoinCodex forecasts suggest the ounce price could reach approximately 522,580 EGP, an increase of 158.46% over current prices.

In Saudi Arabia and the UAE, translating the $5,000 forecast at stable exchange rates, the price could reach around 18,750 to 19,000 SAR (at an exchange rate of 3.75-3.80), and 18,375 to 19,000 AED.

However, it is essential to remember that these forecasts are approximate and depend on assumptions such as stable exchange rates, continued global demand, and no sharp economic shocks.

Summary: An Uncertain Path but Tilted Upward

Gold price forecasts 2026 appear central to understanding the trajectory of precious metals in the coming year. As the cycle of monetary tightening nears its end and the global economy enters a slowdown phase, the market may witness a tug-of-war between profit-taking waves and new purchases by central banks and institutions.

If real yields continue to decline and the dollar remains weak, gold is poised to record new historic highs. But if confidence in financial markets returns and inflation sharply recedes, the metal could enter a long-term stabilization phase, potentially preventing the target levels of $5,000 from being reached.

Simply put: gold in 2026 will not be directionless, but its trend will be determined by a delicate balance of monetary, geopolitical, and investment demand factors whose dynamics are still evolving.