Gold has been performing exceptionally well recently, reaching multiple record highs. The latest surge occurred on nearing the $4,000 mark, driven by investors and central banks looking for a secure asset amidst global uncertainty. The business environment is highly uncertain.
Despite Fortune has reported, Goldman Sachs maintains its optimistic outlook on gold, projecting it to reach $4,300 per ounce by the end of 2026. Mark Haefele from UBS shares this positive sentiment regarding gold's future performance. Continue to be a crucial safeguard. Deutsche Bank thinks indicates that, fundamentally, investors are feeling apprehensive.
Research doesn'share this optimism, as technical strategist Paul Ciana cautioned investors on Monday. "The chance of a downturn has increased," he stated in a market assessment, aiming to tackle the crucial query during the latest government shutdown: "Is anything capable of sh Could this halt the gold rally? The answer is unequivocally yes. Ciana pointed out that a range of technical indicators across different time frames are signaling that the upward trend is losing steam.
Ciana stated that while macroeconomic pressures and geopolitical concerns have driven "safe haven" capital into gold, the market's direction has begun to Precarious as speculative positions expand. Ciana emphasized that the recent upward trend is primarily driven by momentum rather than by the actual underlying strengths of the market, which increases the likelihood of a significant downturn. Whether market sentiment changes or monetary policy is unexpected. He pointed to inflated graphs, signs of being "overbought," and declining positive divergence, cautioning that markets might experience a downturn if any supporting elements Mitigate or undo.
The long history of gold rallies
Gold has surpassed a number of Ciana’s price objectives, with the most recent being $3,880. As of Monday, gold was trading approximately 20% above its 200-day simple moving average, suggesting a potential "relevant peak may be close," similar to major peaks observed in August 2020. Dates such as August 2011, March 2008, and May 2006 saw prices approximately 25% higher than the typical level.
He observed that gold experienced a roughly 85% surge from its 2015 lows up to 2020, subsequently dropped approximately 15% until 2022, and then climbed an additional 130%. Acknowledging that more growth is certainly achievable in the coming two years and that this current surge is less significant than those seen in the 1970s and 2000s, Cia NA identifies a pattern of "midway corrections" occurring in 2020–22, 2007–08, and 1975–76.
Ciana further observes that the 19th century saw a gold boom from 1862–64, which achieved a 156% increase before being entirely lost in the subsequent downturn. He remarked, referencing his history book, that the economic booms since the 1930s haven'fully receded.
Or is there much more room to run?
From within BofA itself, a distinct viewpoint emerges, as a separate team at the bank analyzed figures some weeks ago, suggesting that gold might not be positioned to... Is far from its capacity. The international team focused on commodity analysis, headed by Michael Widmer contended that gold reaching $4,000 was entirely predictable.. Gold prices have historically remained strong when inflation exceeds 2% and the Federal Reserve loosens monetary policy, a pattern observed since 2001, according to an analysis by Widmer’s team presented on September [date]. 15.
Widmer pointed out that last month, the global gold sector's total market capitalization had surged to over $550 billion, almost double The peaks observed in 2011 and 2020, which were over eightfold the 2016 cycle low and more than triple the recent 2022 cycle low. However, viewed through another lens, Widmer noted that as a proportion of the entire global equity market, the metal is "considerably lower" than its past peaks. The original text is not provided. Please provide the content you would like me to rewrite. The industry represented 0.39% of global market value, a figure still considerably lower than the peak of 0.71% observed in 2011.
Widmer and Ciana appear to concur on the rapid pace of gold's recent movements. Considering that Widmer's price target of $4,000 was set for the year 2026, gold's closing price on Monday was $3,984.40.