Gold entered November with renewed volatility after a sharp decline last week, concluding October with its steepest monthly loss since 2008. Bullion finished Friday’s session at $3,875 an ounce, dropping 3.6% and tumbling below multiple key support levels as pressure from equity market turmoil and energy price changes weighed on sentiment.
Price drop accelerates amid selling pressure
The precious metal broke below $3,970 and then lost further ground, ending under $3,886, a level last seen in October 2025. According to a report by BeInCrypto, a series of factors including elevated oil prices, shifting interest-rate expectations, and intensified stock-market turbulence contributed to the selloff.
Ole Hansen, head of commodity strategy at Saxo Bank, noted that technical-driven selling has dominated after gold slipped below support. He pointed out that hedge funds have reduced bullish positions for nine consecutive weeks, reflecting persistent pessimism among market participants. Hansen suggested that a move back above $4,000 would be needed to stabilize the short-term outlook, but such a rebound alone would not be enough to confirm a sustainable recovery.
Hansen cautioned that continued capitulation by gold holders could drive prices lower for a longer period, while a return above $4,000 would be a first signal for easing short-term pressure, though not a definitive recovery.
BeInCrypto also reported that investors have added around 150 tonnes to gold exchange-traded funds since July, but much of these positions are now held below purchase cost, creating potential for further liquidation if pressure mounts.
Macro factors and market sentiment
Gold’s lack of yield makes it vulnerable as interest-rate expectations shift. Higher interest rates often diminish gold’s appeal relative to other investments. Economist Robin Brooks observed that since the onset of the conflict in Iran, every 10% rise in Brent crude oil has been associated with a 4% fall in gold, emphasizing the role of energy prices in shaping short-term dynamics.
According to Saxo Bank’s analysis, ongoing inflationary pressures resulting from higher energy costs have kept expectations for two further US interest-rate hikes intact, though these remain market projections rather than Federal Reserve commitments. Hansen suggested that a broader downturn in stocks could prompt the Fed to reconsider these projected increases.
Equity market stress has also influenced recent moves. Market commentator Prem Soni characterized the week’s selling as a margin call event for overextended investors, underscoring additional liquidity pressures on alternative assets such as gold.
Mini dictionary: Saxo Bank is a Denmark-based investment bank specializing in online trading and investment, known for its commodity market research and strategy coverage.
One analyst described the recent selloff as a margin call for investors with high leverage and limited cash flow, forcing them to liquidate holdings in assets such as gold.
This complex environment produces diverging forecasts for bullion. While current selling has hurt the metal, Hansen and others believe that if deteriorating stock-market conditions prompt the Fed to delay or cancel expected rate hikes, gold could eventually rebound.
Outlook and analyst perspectives
The near-term outlook remains fragile. Following gold’s drop below $3,900, analysts differ on the prospect for additional downside. Brooks assessed that while the resumption of open conflict involving Iran could pressure gold further, the downside risk may be contained rather than open-ended.
Incrementum asset manager Ronnie Stoeferle drew attention to a sharp pullback in silver bullish positions, which fell from 42,756 contracts in July 2025 to just 3,321. He also noted that only 10% of gold mining stocks currently trade above their 200-day moving average, signaling ongoing market weakness but stopping short of calling a bottom.
Market strategist Rashad Hajiyev presented a longer-term scenario, describing 2026 as a likely period of consolidation, with potential for gold to move near $10,000 by 2027 or 2028. This view remains speculative and does not resolve short-term uncertainty.
| Analyst | 2025-2026 Forecast | Key View |
|---|---|---|
| Ole Hansen (Saxo Bank) | Short-term: Below $4,000; upside possible above $4,000 | Selling pressure could persist; rebound above $4,000 would help |
| Robin Brooks | Downside seen as limited in case of Iran conflict | Links Brent oil spikes to gold declines |
| Rashad Hajiyev | Long-term: Potential for $10,000 in 2027–2028 | Speculative, consolidation expected in 2026 |
Key US events and what to monitor
Traders are closely watching two major events this week: the US midterm elections and the October jobs report, due Friday. The outcome of these events may influence gold’s trajectory, particularly if they affect risk sentiment or expectations regarding future Federal Reserve policy decisions.
Hansen believes that a decisive move above $4,000 would be needed to begin easing short-term downside pressure, but ongoing risks from energy markets, geopolitical tensions, and equity volatility mean the outlook for gold remains unsettled.
