Gold’s impressive rally may be nearing exhaustion as momentum indicators point to overextension relative to historical trends.
Notably, the precious metal is now hovering near the $4,000 mark, driven by its safe-haven appeal amid prevailing economic uncertainty.
As of press time, gold was trading at $3,886 per ounce, up nearly 50% in 2025.
Now, according to observations by Bloomberg Intelligence senior commodity strategist Mike McGlone in an X post on October 4, the metal, currently about 18% above its 100-day moving average, has reached levels of exuberance similar to when it first crossed $2,000 an ounce in 2020 and again near $3,000 earlier this year.

His analysis showed gold’s rapid ascent toward the upper band of its mean reversion envelope near $4,000, well above the $3,430 average, levels that in past cycles have often preceded sharp corrections or consolidation.
Meanwhile, the S&P 500’s 60-day volatility index remains subdued, signaling market complacency even as gold, a traditional hedge, grows increasingly stretched. Historically, such divergence between a calm equity market and an overheated gold price has preceded key inflection points.
According to McGlone’s outlook, if history rhymes, gold’s current trajectory suggests the bull run could be entering its final, overheated phase, potentially setting the stage for a pullback after an extraordinary multi-year climb.
Wall Street bullish on gold
Still, despite the concerning technical picture, some analysts on Wall Street believe the metal may have more upside beyond $4,000.
Goldman Sachs, for instance, expects gold to surpass its $4,000 per ounce target by mid-2026 as upside risks grow.
The bank highlighted two key drivers: sustained demand from exchange-traded funds (ETFs) and central banks, and the minimal role of speculative trading so far. With speculative flows still muted, Goldman sees room for further gains if trader participation rises.
The bank reaffirmed gold as its top commodity pick, citing robust central bank demand, rising private sector interest, and its enduring role as a hedge during market downturns.
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