Gold is entering the final quarter of 2026 after a period of consolidation, with rising bond yields and tighter monetary policy creating short-term pressure on the precious metal. Yet despite these headwinds, one market strategist believes gold could still have a stronger finish to the year.
Gold prices are looking to finish the third quarter with a gain of around 4%, despite falling from last month’s highs near US$4,700 an ounce. The recent weakness has coincided with a sharp rise in 10-year US Treasury yields, which have climbed to around 5.27% — their highest level in roughly 20 years.
Higher yields increase the opportunity cost of holding an asset such as gold, which does not pay interest. However, the fact that gold has remained relatively resilient despite this pressure is significant.
Fawad Razaqzada, Market Analyst at FOREX.com, believes this resilience could set the stage for a stronger fourth quarter.
“Given gold’s ability to remain steady in what should otherwise have been a tough macro environment, the precious metal could have a shinier Q4.”
The bigger issue is confidence in fiat currencies
According to Razaqzada, US monetary policy remains one of the most important short-term drivers of gold. Markets continue to assess the possibility of further rate increases while investors watch closely to see whether the Federal Reserve can bring inflation under control.
But there is another side to the equation.
If confidence in the Federal Reserve’s ability to control inflation or bond yields weakens, investors may once again turn towards assets that offer protection against currency debasement.
That could benefit gold and silver.
From a physical bullion perspective, this is an important distinction. Gold does not need interest rates to fall tomorrow to have a long-term monetary role. Its appeal comes from the fact that it is physical, scarce and cannot be created by a central bank or government simply by expanding a balance sheet.
Central banks remain an important source of demand
Central-bank buying is another factor supporting the longer-term gold market.
Razaqzada believes continued concerns surrounding bond markets could encourage central banks to further diversify their reserves away from US Treasuries and towards gold.
If central-bank purchases remain strong, this could provide an important underlying source of demand even when higher yields and a stronger US dollar create short-term volatility.
For physical gold owners, this is worth watching. Central banks are not buying gold because they expect to make a quick trade. They are adding an asset to their reserves that carries no counterparty risk and is recognised globally.
Gold’s long-term trend remains intact
Technically, Razaqzada identifies US$4,000 as an important long-term support area, following gold’s sharp rally away from that level earlier in the year.
He also identifies approximately US$4,400 as a key resistance level. A sustained move above that area could potentially open the way towards US$4,500, then the previous high near US$4,700 and, eventually, the US$5,000 level.
Of course, short-term price forecasts are just that — forecasts. Gold can fall sharply, particularly when yields and the US dollar rise.
But the more important question for a physical bullion holder is not necessarily whether gold reaches a particular price next week or next month.
It is how much physical gold you own when the next monetary or financial crisis arrives.
Gold and silver are not bought simply to get rich. They can provide a form of financial insurance against inflation, currency weakness, excessive debt, monetary instability and declining confidence in traditional financial assets.
For FirstGold, the long-term principle remains simple:
Don’t worry only about the price of gold. Worry about whether you own enough physical gold.
Disclaimer: Market commentary is general information only and is not financial advice. Past performance and market forecasts are not guarantees of future results.
