Are we expecting a crash in gold prices in 2026? Bold predictions surpassing $5000

Gold experienced an unexpected rise in 2025, breaking historical barriers never seen before in the markets. But the question on investors’ minds now is not when the rise will continue, but when will we see a genuine decline in gold prices? And is 2026 the year that will settle this debate?

The Crazy Gold Journey in 2025… From 3000 to over 4300 USD

The year started modestly around $3455 per ounce, but the following months saw a rapid ascent. Last October, gold broke the psychological level of $4300, reaching a new all-time high supported by two main factors: fears of a global economic slowdown, and the gradual return of accommodative monetary policies.

Central banks were the strongest allies for gold during this period. They added 244 tons to their reserves in just the first quarter, an increase of 24% over the historical average. China alone added more than 65 tons, reflecting a growing global desire to reduce reliance on the US dollar.

The Six Factors That Will Determine Gold’s Path in 2026

First: Decline in real yields

The Federal Reserve cut interest rates twice, the last in October by 25 basis points. The market is now pricing in an additional cut in December, which could bring the rate down to around 3.4% by the end of 2026. This decline means one thing: the opportunity cost of holding gold will decrease, and its attractiveness will increase.

Second: Institutional demand remains strong

Gold ETFs attracted $21 billion in the first half of 2025 alone. The total now reached 3838 tons, very close to the all-time peak of 3929 tons. This continuous influx of capital indicates that investors do not see gold as a temporary speculative tool, but as a long-term investment.

Third: Ongoing supply crisis

Mine supply has not kept pace with demand. On the contrary: recycled gold decreased by 1% as owners prefer to hold onto it expecting further increases. Extraction costs rose to $1470 per ounce, the highest in a decade. This means any increase in production will be slow and costly.

Fourth: The dollar is losing strength

The dollar index has fallen by 7.64% since the start of 2025. This weakness makes gold cheaper for buyers in foreign currencies, increasing global demand.

Fifth: Sovereign debt creeping into trillions

Global public debt has exceeded 100% of GDP. In this environment, gold is seen as a hedge against future inflation risks and potential financial collapses.

Sixth: Geopolitical tensions will not disappear

Trade conflicts between the US and China, tensions in the Middle East, added 7% to gold demand according to Reuters. These tensions are unlikely to fade in 2026.

Major Bank Forecasts: $5000 on the Horizon

HSBC: expects gold to reach $5000 in the first half of 2026, with an annual average of $4600.

Bank of America: raised the ceiling to $5000, with an average of $4400, but warned of short-term corrections.

Goldman Sachs: revised its forecast to $4900, citing strong ETF inflows.

J.P. Morgan: expects gold to reach $5055 by mid-2026.

The most common range among these banks: $4800 to $5000 as a peak, and $4200 to $4800 as an annual average.

When Will We Decline? Possible Scenarios

Despite optimism, there are factors that could curb the rise:

Simple correction scenario: if investors start taking profits, we might see a pullback to $4200, according to HSBC’s warning.

Real crash scenario: a collapse would not occur without a major economic shock. HSBC ruled out any drop below $3800 under current conditions.

Long-term scenario: J.P. Morgan and Deutsche Bank agree that gold has entered a “new price zone” that is difficult to break downward, thanks to a strategic shift in investors’ view of it as a long-term asset.

Technical Analysis: Mixed Signals at the Start of Winter

Gold closed trading on November 21 at $4065, after touching $4381 in October. It broke the upward channel line but still maintains the main trend line.

Key levels:

• Strong support: $4000 ( if broken, may target $3800)
• First resistance: $4200
• Next resistance: $4400 then $4680

Momentum indicators: RSI at 50, indicating a completely neutral market. MACD above zero confirms the overall trend remains bullish.

Technical forecast: Gold may stay in a sideways range between $4000 and $4220 in the near term, but the big picture remains positive as long as it stays above the main trend line.

Gold in the Middle East… Local Numbers of Interest

Egypt: The ounce price could reach around 522,580 EGP (an increase of 158% from current prices).

Saudi Arabia: If the ambitious scenario at $5000 is realized, the ounce could be around $18,750 to $19,000 SAR.

UAE: Under the same scenario, the ounce could reach $18,375 to $19,000 AED.

(These estimates assume stable exchange rates and continued global demand)

Summary: 2026, the Year of Resolution

The question “When will we see a genuine decline in gold prices” might not be the right way to phrase it. A better question is: Will the economic conditions necessary for a decline without a major shock materialize?

If real yields continue to decline, the dollar remains weak, and central banks keep buying, gold is likely to hit new highs possibly reaching $5000.

But if inflation suddenly drops and market confidence returns, the metal could enter a long-term stabilization phase, delaying this level’s achievement.

The truth is that the timing of a decline in gold prices depends on factors still outside control: Federal Reserve decisions, central bank actions, and the global geopolitical scene. 2026 will tell us the answer.