Although gold prices have been unable to break initial resistance above $4,200, one market strategist expects the worst of the selling pressure from the months-long correction may now be over.
Although gold has corrected sharply from its record highs above $5,500 an ounce, one precious metals analyst says the pullback has done little to alter the market's long-term bullish fundamentals, maintaining that prices can still end the year around $4,600 an ounce.
The gold market continues to face solid selling pressure as prices have been unable to break through initial resistance at $4,200, and the precious metal is unlikely to attract renewed bullish momentum as activity in the U.S. services sector remains resilient.
Spot gold and silver prices are lower in early U.S. trading Monday, as a firmer U.S. dollar and easing oil-risk premium offset support from softer U.S. labor data and lingering Middle East risk.
Gold edged higher in Asian trade. Softer U.S. jobs data and lower energy prices were likely leading investors to scale back Federal Reserve rate hike bets, said UOB.
Sovereign demand for gold shot higher in May, with central bank purchases reaching the second-highest level of the year, surpassed only to February's outsized performance, according to the latest data from Marissa Salim, Senior Research Lead, APAC at the World Gold Council.“Central banks were back in buying mode in May – and with a little more spring in their step,” Salim wrote on Thursday.
The gold market has rallied a bit this week, as we are trying to defend the major level of $4,000. Furthermore, there is a significant lack of liquidity on Friday, as we are heading into the holiday weekend.
While tactical headwinds such as high yields, a strong dollar and the threat of Fed rate hikes persist, the structural tailwinds of Asian and central bank demand and the need for diversification amid high stock/bond correlation should drive gold prices as high as $5,500 per ounce by March of next year, according to the new Monthly Gold Monitor from State Street Global Advisors.In their review of tactical headwinds, State Street strategists led by Aakash Doshi said gold's opportunity cost and U.S. dollar strength weighed on investor sentiment in June.
After climbing to an all-time high of over $5,300 per troy ounce in January 2026, the spot price of gold dropped to around $4,100 on July 1, punctuated by a 10% drop in June. That was its fourth straight monthly decline.
Spot gold and silver prices are sharply higher on Friday morning with U.S. markets closed ahead of the Independence Day holiday, as Thursday's weaker-than-expected U.S. employment report continued to weigh on the dollar and Treasury yields while supporting short-covering in precious metals.
In times of trouble, investors usually flock to so-called traditional haven investments but the Iran war has put a question mark next to several of these former flights to safety.
Spot gold rose on Friday, putting it on course for its first weekly gain since late May. It came as investors scaled back their bets on the Federal Reserve hiking rates in September.