Bank of America projects gold prices will remain below $4,000 per ounce over the next three months, with an average forecast of $4,000 for the fourth quarter. The metal recently traded near $4,100, which is approximately 27% lower than its record high of $5,598 reached in late January.
Market demand data shows a 16.6% year-over-year decline in purchases by major buyers. Imports in India fell by 77.8%, while Chinese imports increased by 39.3%. Jewelry demand also softened in the second quarter, with the World Gold Council reporting declines of 25% in the US, 15% in India, and 28% in China.
Central bank activity remains a factor, with Turkey selling 82 tons and Russia selling 56 tons of gold through August. Despite this, central banks added a net 39 tons in August. Gold ETFs currently hold a record 4,256 metric tons, which could create selling pressure if investors liquidate positions.
Looking ahead, Bank of America anticipates gold reaching $4,750 in the first quarter of 2027 and $5,000 in the second and third quarters of 2027. Goldman Sachs maintains a target of $5,400 for 2027, following a revision of its end-2026 target to $4,650 in September.
Technical analysis suggests a support level near $3,950, aligning with the 0.5 Fibonacci retracement level of $3,943. Resistance is identified in the $4,300 to $4,400 range. A drop below $3,900 could signal a deeper bearish trend, with the bank noting a potential fourth-quarter low of $3,750.
