Gold has officially entered bear territory after falling more than 20% from its January peak, raising concerns that prices could slip further towards the $4,000 mark if the current global macro pressures persist.
According to analysts at Kotak Securities, spot gold now has immediate support at $4,154.3. If prices fall below this level, the next support is seen at $4,099.2, and a deeper fall could take the metal towards $3,920.7.
The sharp correction has wiped out all gains made by bullion investors in 2026. From its record high of $5,595.46 an ounce in January, US spot gold prices have fallen around 22%, officially placing the metal in bear territory, a term used when an asset falls 20% or more from its recent peak. Gold had ended 2025 at $4,315 per ounce, and prices have now slipped below $4,100 in intraday trade, effectively erasing this year's gains.
What Analysts Have To Say
Analysts say the fall in gold, despite rising geopolitical tensions, is due to a combination of macroeconomic factors. Surging crude oil prices have reignited inflation fears, which in turn has strengthened expectations that the US Federal Reserve will keep interest rates higher for longer. Higher interest rates and rising bond yields reduce the appeal of non-yielding assets like gold, while a stronger US dollar has added further pressure on bullion.
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Kotak Securities noted that the recent sharp fall reflects a classic “dash for cash” phase, where investors sell even safe-haven assets to meet margin calls and rebalance portfolios amid extreme volatility across asset classes. The selling pressure is visible in market data, with COMEX open interest falling to multi-year lows and ETF flows turning negative, signalling that both speculative and institutional investors have reduced exposure to gold.
Hariprasad K of Livelong Wealth said the fall in gold and silver prices despite geopolitical tensions highlights how macro factors such as rising interest rate expectations and a stronger dollar are currently dominating market direction. Elevated crude oil prices have revived inflation concerns globally, reinforcing the higher-for-longer interest rate narrative and keeping pressure on bullion.
Market experts, including Peter McGuire in an interview with NDTV Profit, believe gold may see further softness in the near term as precious metals have been heavily sold and liquidity pressures remain high.
While all analysts see a near term decline prominent American stockbroker and a Global Strategist, Peter Schiff, who is the Chief Economist at Europac.com, has asked investors who were bullish on gold before the war to be more bullish nore.
Explaining his rationale in a post on X, he said, "In the early months of the 2008 GFC, gold crashed 32%, about 40% of its prior bull-market gain. After gold bottomed, it surged 178% over the next three years. Gold nearly hit $4,100 today, down 27%, about 40% of its gain since $2K. A 178% surge from that low puts gold at $11,400."
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