I have been paying close attention to the gold market recently and discovered a quite interesting phenomenon—the logic behind this round of gold price movements is much deeper than just surface-level interest rate cuts and geopolitical risks.

On the surface, the rise in gold prices seems to be simply due to expectations of Federal Reserve rate cuts, inflation pressures, and geopolitical tensions—these old familiar factors. But what truly supports the entire bull market is actually the collective questioning of the U.S. dollar system by global central banks. According to data from the World Gold Council, last year, global central banks net purchased over 1,200 tons of gold, marking the fourth consecutive year surpassing the thousand-ton mark. More importantly, 76% of surveyed central banks believe they will increase their gold holdings over the next five years, while also expecting a decline in dollar reserves. This is not short-term speculation but a systemic shift in asset allocation.

I noticed that the recent upward trend in gold prices involves quite complex factors. On one hand, the U.S. fiscal deficit continues to expand, debt ceiling disputes occur frequently, and along with the de-dollarization trend, capital continues to shift from dollar assets to hard assets. On the other hand, the total global debt has reached $307 trillion, and high debt levels limit the flexibility of countries' interest rate policies. Monetary policy tends toward easing, indirectly boosting gold’s attractiveness. Uncertainty around tariffs, changing expectations of Fed rate cuts, these are triggers for short-term volatility.

From institutional forecasts, by 2026, the average price of gold is expected to be between $4,800 and $5,200 per ounce, with year-end target prices between $5,400 and $5,800. Goldman Sachs has raised its year-end target to $5,700, while JPMorgan is more aggressive, predicting it could reach $6,300 in Q4. But the logic behind these forecasts all points to the same conclusion—central banks continuing to buy gold, safe-haven demand exploding, and real interest rates declining—all of which will continue to support gold prices.

Of course, gold price movements will not be a straight line. The recent pullbacks are clear evidence of this. As real interest rates rebound and crises ease, gold prices have experienced noticeable corrections with high volatility. But this is precisely where opportunities lie. If you are an experienced short-term trader, the volatility around U.S. market data releases (non-farm payrolls, CPI, FOMC) can offer many trading opportunities. If you are a long-term investor, the current pullback might actually be a good entry point.

But I must honestly say that the volatility of gold assets is not actually lower than stocks—annual average amplitude is 19.4%, compared to the S&P 500’s 14.7%. If you want to participate in this round of market, you must think carefully about your positioning. Beginners should avoid blindly chasing highs; start with small capital to test the waters, learn to read economic calendars, and track U.S. economic data release timings. Long-term investors should be prepared to endure a 20% or more correction. Experienced traders can consider a combination of long and short strategies—holding a core position long-term, while using volatility to trade short-term swings.

The gold price trend in 2026 is more like oscillating at high levels with an upward bias, rather than a continuous upward trend. The key is that the central bank gold-buying trend will not suddenly disappear because inflation remains sticky, debt pressures persist, and geopolitical tensions continue. The bottom of gold prices will keep rising, with limited downside in bear markets and strong continuation in bull markets. But you need a systematic approach to monitor the market, rather than blindly following news trends. That is the correct attitude to handle the volatility in gold prices.