Gold – Months of relentless gains and the drop – Is It Time for Prices to Stabilize?

Structural Drivers Keep Long-Term Bullish Momentum Intact

Longer term bullish momentum remains intact, basis the structural and diversification trend. Supporting the view is the Central Banks purchases of 230 tons in Q4 of 2025. The same trend of above 800 tons of buying is expected for 2026. Wide macro and geopolitical risks are still intact leading to broader portfolio allocation into gold as a hedge. Rising ETF holdings would continue to chip in to the momentum.

Gold Price Outlook 2026 and Futures Highs

Gold for the year 2026 is likely to cross the highs of the “Futures” of $5645 made recently. Speed of the rally, unsustainable levels and the speculative trades gave a pull back rally for a major correction. But the bounce due to the structural fundamentals and diversification would help surpass this high in 2026. The physical demand remains far above and keeps the market tightening.

Silver’s Deeper Shakeout Compared to Gold

The shakeout in Silver was much deeper after a dramatic surge leading to a cautious note on the recovery as compared to Gold which would start its catch up rally. Silver is likely to remain around $72 to $78 and a breakout above $80 will decisively identify a recovery. The damage caused to Silver was majorly on account of higher collateral requirements on hiking the margins forcing traders to liquidate their positions accelerating the price drop. Over the longer-term higher prices will reshape fundamentals on the aspect of supply-demand balance and the eroding deficit which led to Silver’s recent surge.

The volatility and price swings in the bullion pack has led one to believe that Gold and Silver too are nothing more than risk assets. They carry the same inherent risk as most other financial investments, with exceptions of physically holding the metals.

Corrections, Confidence, and Long-Term Conviction

There is merit in Gold prices to rally despite the fact that Gold has entered the year 2026 with volatility. Corrections are part of restoring balance when markets move too far, too fast. Although Gold is trading in an unstable phase where confidence and risk management matter, there is a long-term conviction.

It’s now a question of Gold will it “Stabilize” or “Volatility” to continue which will dictate the near-term direction.