Gold 2026 Price Forecast: Gold Targets $3,500 Floor on Hawkish Fed Expectations

Gold Technical Analysis

The gold market has been very interesting this year. It’s actually been negative, and one would be forgiven for assuming that it should be in the other direction. After all, we’ve had the United States and Iran go to war.

But something interesting happened: traders started to focus on interest rates, which were rising, and that is because of the idea of inflation, which some people look at gold as an inflation hedge as well. So that’s interesting to me how behavior has played out, but it makes more sense for a large money manager to put money in paper, press a button, than to store gold. There is a cost involved in gold; there is no yield in gold. And instead, they’ve been able to sit in US Treasuries, which is the same thing as cash, and get a bit of a return on some of their capital.

So, as I do this, we are closing out the end of June and we’re heading into July, hanging around the $4,000 level. Now, I think there are multiple scenarios that could go on here. I will state longer-term, I like gold. I like gold a lot. In the meantime, though, I think we are going to have a lot of noise in the second half of this year because one thing that I do know is that the war in Iran could pick up all over again pretty quickly.

I do have some fears about that, but at the same time, the US president, Donald Trump, seems to be pretty irritated with the situation, so he’ll do something else. That would actually be good for gold because eventually you will start to see people pay attention to yields, hopefully dropping, but they are not yet. Part of that comes down to people now expecting the Federal Reserve to raise interest rates twice between now and the end of the year. And that’s why I think the selling isn’t done, at least not yet.

Federal Reserve Policy, Safe-Haven Dynamics, and Technical Targets

$4,000 is an area that will be difficult to break through, but there is an area right around $3,500 that I’d be very interested in. I anticipate that at the beginning of the second half of the year, we will get a lot of bouncing around, choppiness, maybe a range between $4,000 and $4,250 or so, spilling out of that range occasionally, but I think it will be a range-bound market.

Eventually, though, I do think we find our way down to $3,500 simply because traders are still focused on the Federal Reserve. If things cool off and the Federal Reserve bets are cut back, that will be your catalyst for gold to go higher.

Two Stories Between Now and New Year’s Day

So, I’m thinking this is going to be a tale of two stories: maybe a little bit of sideways action with more of a range-bound market with a slightly negative bias, and then eventually, probably as we get into the later part of the year, especially if the Federal Reserve does not start raising rates, then the market can turn around. I look at $3,500 as a very realistic floor right now, but obviously, headlines can change everything.

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