Gold Slips 5.5% From 3-Month High; Goldman Sachs Keeps 10% Upside Target

Gold has dropped 5.5% from its August 25 three-month high of 4,697, hovering near 4,436 at publication. The 4,900 year-end forecast from Goldman Sachs remains intact.

The selloff has taken gold below its 200-day moving average. According to Barchart, the metal has logged several closes under that level for the first time since early June.

Gold Rally Stalls at a Closely Watched Technical Level

The 200-day moving average measures an asset's average closing price across 200 sessions. Gold now trades beneath that threshold, which sat near 4,529. On Monday, the metal briefly fell under 4,400, its weakest since August 19.

Barchart observed that the SPDR Gold Shares fund entered a technical correction during the last instance of gold recording multiple closes under the average. That single prior occurrence is just one data point, not a consistent pattern.

Gold now has multiple closes below its 200-day moving average for the first time since early June 🚨 $GLD went into a technical correction the last time this happened 📉 📉 pic.twitter.com/DbGVgNNqTq

— Barchart (@Barchart) August 31, 2026

The latest decline has been fueled by renewed wagers on a Federal Reserve interest rate increase. Gold is negatively affected by rising rates since it offers no yield.

Goldman Sachs and Fidelity Maintain Bullish Outlook

Despite the drop, Goldman Sachs Research reiterated its 4,900 target for year-end 2026 in an August 28 note. That represents about 10% upside from current levels.

Goldman had previously lowered that projection by $500 in June, when expectations for 2026 rate cuts diminished. Even the reduced figure pointed to a gain, albeit a more modest one.

The bullish case rests on official purchases, according to senior commodities analyst Lina Thomas and Global Commodities Research co-head Daan Struyven.

"We continue to see elevated central bank gold accumulation as a multi-year trend, as central banks diversify their reserves to hedge geopolitical and financial risks, consistent with recent survey evidence," they wrote.

Goldman anticipates central banks purchasing an average of 50 tonnes monthly in 2026, compared with 17 tonnes prior to 2022.

Separately, Fidelity's assessment placed gold at roughly 5,000 relative to the global M2 money supply, approximately 13% above the current price.

As for gold, it gained ground last week as the global liquidity profile has started to recover. Based on my Gold & Liquidity regression between global M2 and gold, gold is worth around $5k. Below is a longer chart, which illustrates how gold has gone from a pure play on real… pic.twitter.com/oRkpLXZiI9

— Jurrien Timmer (@TimmerFidelity) August 14, 2026

Goldman had already flagged the near-term risk. Its June note forecast gold at 4,400 by year-end if the Fed hikes, and the metal reached that level on Monday. A continued break below could test the debasement trade, where gold and Bitcoin (BTC) demand is tied to currency erosion.