Will gold prices reach $10,000? Even as gold enters a bear market, market observers remain firmly bullish.

Key Takeaways

• Gold has recently been hit by a sharp selloff and has officially entered a bear market.
• Some analysts say the recent drop “offers investors an extremely attractive entry opportunity.”
• But some seasoned market participants still stick to their ambitious long-term outlook.

Gold’s recent sharp selloff has officially pushed it into a bear market, but some seasoned market participants still stick to their ambitious long-term outlook.

On Tuesday, the gold price continued to fall. Spot gold briefly plunged by 2%, then narrowed its decline; it ultimately fell 1.5%, to $4,335.97 per ounce. Gold futures fell by about 2% to $4,317.80, and silver prices also moved lower in tandem.

This run of consecutive declines has pulled the gold price down by about 21% from the record high of $5,594.82 set in late January, officially putting it in a bear market.

To many strategists, this round of selling reflects more of a short-term market mismatch rather than a change in gold’s underlying fundamentals. Ongoing geopolitical risks, strong central bank demand for gold purchases, and expectations for a weaker dollar still support gold’s structural bull market. Gold is widely viewed by investors as a safe-haven asset during turbulent times.

“We still stick to our forecast for the gold price to reach $10,000 by the end of this decade,” said Edie Yadny, president of Adeyney Research, in an email to CNBC. Although he cut this year-end target price from $6,000 to $5,000, that level is still about 15% higher than the current gold price.

The latest round of gold price declines was driven by investors closing positions and exiting in the context of a stronger dollar, along with signs that geopolitical tensions are easing—U.S. President Trump announced on Monday that he has ordered a pause in the planned strikes against Iran’s energy infrastructure for five days.

Market participants say the dollar’s continued strength may have triggered profit-taking in gold.

Since the conflict broke out on February 28, the U.S. dollar index has risen by about 3%.

Even though the near-term trend is weak, strategists generally view this selloff as an opportunity rather than a trend reversal.

Justin Lin, a portfolio strategist at Global X ETFs, said his benchmark outlook for gold remains $6,000 per ounce by year-end, and he described the recent selloff as “an extremely attractive entry point for investors.”

“The current selloff appears to be driven by a combination of multiple short-term factors, including sensitivity to high interest rates, portfolio rebalancing triggered by weakness in the stock market, and a certain degree of easing in market sentiment regarding Iran’s ongoing conflict,” Lin said in an email.

Crucially, Lin emphasized that his bullish outlook does not rely on a war-related risk premium.

“Instead, it is built on a broader backdrop, including ongoing geopolitical uncertainty, continued central bank gold-purchasing demand, and continued inflows into Asia-based gold ETF investors,” he said.

This kind of structural demand—especially that created by emerging-market central banks as they seek to diversify reserves—is expected to provide support for gold prices. Lin added that after the recent selloff, central banks are “very likely” to step up purchases, which should help stabilize the market.

Standard Chartered Bank also maintains a constructive view on gold and cites similar long-term drivers.

“Our long-term outlook for gold remains optimistic. Our support factors include strong gold-purchase demand from central banks in emerging markets, as well as investors’ demand for asset diversification amid geopolitical risk,” said Rajiit Bhattacharya, the bank’s senior investment strategist, in an email to CNBC.

The bank expects that once the current deleveraging phase ends, gold prices will rebound to around $5,375 per ounce within the next three months, with technical support around $4,100.

A key catalyst for gold’s recovery could be a weaker dollar, as markets expect the Federal Reserve to eventually cut interest rates.

“A weaker dollar will support gold prices again,” Bhattacharya said.

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Byline: Guo Mingyu