​Record highs confirm $4,000 gold breakthrough – where to next?

Historic milestone surpasses bullish expectations

Gold rally has gone well beyond even the most bullish expectations, with the precious metal now trading above $4,000.00 per ounce for the first time in history. What was once an ambitious target has become reality, underscoring the strength of the underlying macroeconomic and geopolitical drivers that continue to fuel demand.

​In 2025, gold has already gained over 50% year-to-date, having shattered multiple record highs on its way past the $4,000.00 threshold. This latest surge builds on seven consecutive weeks of gains, highlighting sustained investor appetite, with an eights in the making.

​Gold weekly candlestick chart

The upward move has been underpinned by concerns over US fiscal stability and growing confidence that the Federal Reserve (Fed) will cut interest rates twice by year-end.

​All of which lower the opportunity cost of holding non-yielding assets like gold, creating ideal conditions for precious metal appreciation.

​Weaker US dollar and lower real yields sustain rally

​A weaker US dollar remains one of the primary catalysts behind gold's strength, as it enhances affordability for foreign investors purchasing the dollar-denominated metal.

​Simultaneously, real yields on US Treasuries - nominal yields adjusted for inflation - have been under pressure, further diminishing the appeal of interest-bearing assets.

​This combination of factors continues to create a supportive environment for gold, as its traditional drawback - the absence of yield - becomes less relevant in low real yield environments.

​The negative correlation between real yields and gold prices has once again proven reliable, underpinning the metal's climb to new highs.

​Central bank buying provides structural support

​Institutional demand remains a powerful force supporting gold prices. Central banks and sovereign funds have maintained elevated levels of gold purchases, estimated at 400-to-500 tons annually, according to Deutsche Bank.

​The World Gold Council reports continued diversification away from US dollar assets, a structural trend that has helped establish a solid price floor beneath the market.

​Unlike speculative investment flows that can reverse quickly, central bank accumulation represents long-term strategic positioning, lending stability to the broader rally.

​This institutional demand creates a fundamental support level that helps sustain higher prices even during periods when investment demand might moderate.

​Safe-haven demand intensifies

​Gold's traditional role as a safe-haven asset has become increasingly relevant amid global uncertainty. Persistent geopolitical risks - from the Russia-Ukraine conflict to Middle East instability - combined with US and French political gridlock and mounting fiscal concerns, have driven investors toward defensive assets.

​Inflation remains stubbornly high, while markets anticipate a dovish shift from major central banks, creating conditions where gold's inflation-hedging characteristics are highly valued.

​Each episode of political or economic tension has reinforced gold's appeal as a hedge against uncertainty, creating a self-reinforcing cycle of demand and momentum-driven buying.

​The accumulation of global risks creates an environment where portfolio managers view gold as essential insurance rather than optional diversification.

​Analysts revise targets higher

​With gold now above $4,000.00 per ounce, attention shifts to how far this rally could extend and what might sustain it. Continued downward pressure on real interest rates, persistent dollar weakness, and ongoing institutional accumulation will be essential.

​Analyst projections have adjusted swiftly in light of gold's breakout. JP Morgan now suggests average prices could remain near $4,050.00–$4,200.00 in late 2025, while Goldman Sachs highlights potential for $4,500.00.

​Under continued demand from both private investors and central banks, these revised forecasts reinforce the notion that gold's ascent is rooted in fundamentals, not just short-term speculation.

​New geopolitical or macroeconomic shocks could further accelerate the safe-asset bid, while supply constraints may magnify future price gains.

​Risks could cap further advances

​Despite its strength, gold's trajectory is not without risks that could slow or reverse the advance. A resurgent US dollar, as has been the case over the past few weeks, delayed or smaller-than-expected rate cuts, or a sudden improvement in global risk sentiment could all sap demand.

​Profit-taking after such a steep advance is also possible, with technical corrections likely along the way as momentum investors lock in gains.

​Should central banks slow or reverse their buying pace, one of gold's key pillars of support could weaken, removing crucial institutional demand that has underpinned recent strength.

​Extended rallies often experience corrections, and the speed of gold's recent gains suggests that consolidation or pullbacks may occur before any further major advances.

​Gold technical analysis

​Now that the psychological $4,000.00 mark has been reached, the gold price may stall around this round number in the short-term as investors might be tempted to cash in some profits after eight consecutive weeks of gains.

​Were this not to be the case, the next technical upside target would be the 261.8% Fibonacci extension at $4,308.00. It is measured from the December 2015 low at $1,046.46 to the August 2020 high at $2,075.28 and projected higher by a factor of 2.618 from the September 2022 low at $1,614.93.

​The short-term uptrend will remain intact while no bearish reversal takes the gold price through its August-to-October uptrend line at $3,835.00 and the last reaction low seen on the 2nd of October at $3,819.43.

​Gold daily candlestick chart