U.S. gold futures maturing in December touched $4,000 briefly, before retreating a bit.
Gold prices rose to another all-time high in early trading on Tuesday, as political uncertainties in major economies and hopes of monetary policy easing bolstered the precious metal’s appeal. Some Wall Street analysts, however, believe the rally has further room to run.
Spot gold prices rose as high as $3,977.45 per ounce before paring some of the gains. U.S. gold futures maturing in December touched $4,000 briefly, before retreating a bit. Retail sentiment on Stocktwits about the SPDR Gold Shares ETF (GLD) was in the ‘bullish’ territory, compared with ‘neutral’ a day ago.
“$GLD this isn’t like other stocks. Central banks around the world have been piling their money into gold because they know what is coming. Retail investors haven’t even woken up to this yet,” said one user.
“Final target is $380-$385, but before that pullback is coming,” wrote another user, re-upping their prediction for GLD from August.
What’s Driving Gold Higher?
Gold prices have surged by more than 50% this year, driven by geopolitical uncertainties, the weakening of the dollar, central bank buying, and strong retail participation. Net inflows for the last week stood at 655.7 thousand ounces, taking the total gold ETF holdings to the highest level since September 2022.
Political Turmoil Adds To Shine The U.S. government shutdown entered its seventh day on Tuesday with Democratic and Republican lawmakers still unable to resolve their differences over key issues, including healthcare. Due to the impasse, the release of key data, including the jobs report, has been delayed. It has renewed concerns about the nation’s finances and put pressure on the dollar, prompting more investors to turn to gold as a safer bet.
Separately, French Prime Minister Sebastien Lecornu resigned just weeks after taking office as an increasingly divided French Parliament struggled to pass a budget amid an ongoing debt crisis.
Analysts See More Upside
Goldman Sachs reportedly raised the year-end 2026 price forecast of gold to $4,900 from $4,300.
“We see the risks to our upgraded gold price forecast as still skewed to the upside on net, because private sector diversification into the relatively small gold market may boost ETF holdings above our rates-implied estimate,” Goldman analysts said, according to a Reuters News report.
“With official data delayed, traders are depending on private reports for economic insight, while the central bank faces challenges in making monetary policy decisions. Still, markets expect a quarter-point rate cut this month, which could further support gold,” ING Commodities analysts wrote.
Outpacing Equities & Bitcoin
Spot gold has been on a tear this year, surging over 51% and leaving gains recorded by benchmark S&P 500 and Nasdaq indices, as well as Bitcoin’s 32% jump, in the dust. While GLD has seen a similar jump, the VanEck Gold Miners ETF (GDX) has rocketed over 125%.
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