Based on the current public data and mainstream institutional views: gold is still worth allocating, but the strategy must shift from 'short-term chasing' to 'phased, buying on dips, long-term allocation.'
At the beginning of 2026, gold experienced a sharp pullback - after reaching a temporary high, it faced nearly double-digit retracements in a short period due to factors such as the strengthening of the US dollar, changes in Federal Reserve policy expectations, and exchanges raising margin requirements. This volatility is more a result of liquidity and position structure adjustments rather than a breakdown of long-term logic.
What is truly worth discussing is whether the core driving forces supporting gold have changed?
1. Is the long-term logic still there?
1️⃣ The pricing logic of gold is expanding, not replacing
The consensus on Wall Street over the past two years is that gold is no longer just a traditional 'inflation hedge' but is gradually becoming one of the assets to hedge against the expansion of fiscal deficits, weakening monetary credit, and long-term debt uncertainty.
This does not mean that the inflation logic has disappeared, but rather that pricing factors are becoming more diverse—real interest rates, the strength of the dollar, central bank demand, liquidity of funds, and geopolitical risks are working together.
In other words, the macro narrative around gold is strengthening, not simplifying.
2️⃣ Central bank demand constitutes structural bottom support
The World Gold Council (WGC) data shows that the People's Bank of China has increased its gold holdings for 15 consecutive months, with the latest reserves around 2,308 tons, and gold accounting for about 9.6% of foreign exchange reserves.
Multiple institutions (including J.P. Morgan) expect that global central bank gold purchases in 2026 may still approach 800 tons.
The characteristic of central bank demand is 'slow and steady', not participating in short-term volatility games, which provides medium to long-term bottom support for gold prices.
3️⃣ Macroeconomic and geopolitical uncertainties still exist
High global fiscal deficits, policy path divergences, and the normalization of geopolitical conflict risks elevate risk premiums.
However, it should be emphasized that geopolitical events usually only affect risk premiums and do not necessarily equate to long-term unilateral increases. Gold will still be subject to periodic suppression by the dollar and real interest rates.
2. What does the institutional target price mean?
After a significant rise in gold prices in 2025, some top institutions continue to raise their 2026 forecasts:
Goldman Sachs raised its target price to about $5,400 per ounce by the end of 2026.
J.P. Morgan raised it to about $6,300 per ounce and suggested it could be higher in extreme configuration scenarios.
UBS provided a range forecast and indicated that volatility could be significant under different macro paths.
The core premise of these forecasts is: Continued central bank demand + marginal improvement in liquidity + real interest rates no longer rising significantly.
Note: Institutional forecasts are usually based on scenario assumptions, not a certain path.
3. Risks that truly need to be vigilant about
1️⃣ If the U.S. economy significantly exceeds expectations, and the Federal Reserve maintains high interest rates for a longer time, rising real interest rates will suppress gold prices.
2️⃣ If geopolitical risks suddenly ease, risk premiums will decline.
3️⃣ If ETF funds continue to flow out, short-term selling pressure may intensify.
In an extremely pessimistic scenario, gold prices could experience deeper correction ranges.
4. Operational recommendations: shift from speculation to allocation
✔ Not recommended to chase high
Gold is currently highly volatile, and the risk of 'blindly chasing after rises' is obvious.
✔ Gradually build positions
Instead of predicting specific points, it is better to gradually allocate in 3–5 times and increase positions when there is a clear pullback.
✔ Strictly control leverage
✔ The exchanges raising margin requirements indicate increased volatility. High leverage can easily be forcibly liquidated in fluctuations.
Control positions
Most institutions suggest gold as a 'stabilizer' in the portfolio, maintaining a proportion of 5%–10% (adjusted according to risk tolerance).
Final conclusion
Gold has not entered the 'bubble endpoint', but it is also not a certain asset for unilateral increases.
It is evolving from a traditional safe-haven tool into a strategic asset to hedge against macro credit risks and liquidity cycles.
Can be allocated, but do not bet.
Can buy on dips, but do not go all in.
Can hold long-term, but do not fantasize about windfall profits.$BTC $BNB $USDC