Gold prices have been experiencing significant volatility, with recent surges to record highs followed by pullbacks. Despite this, several major financial institutions remain optimistic about gold's potential, with some projecting prices to reach unprecedented levels in the coming years.

UBS recently revised its gold price target upward to $6,200 per ounce for March, June, and September 2026, a substantial increase from their previous forecast of $5,000. This bullish outlook is primarily driven by stronger-than-expected demand stemming from increased investment. Other institutions, such as Deutsche Bank, have also issued forecasts anticipating gold prices potentially climbing to $6,000 per ounce in 2026, fueled by persistent investment demand as central banks and investors increase their allocations to non-dollar and real assets. J.P. Morgan has adopted an even more bullish stance, projecting gold at $6,300 per ounce by the end of 2026.

Spot gold reached an all-time high of $5,594.82 per ounce recently, marking a significant surge of over 20% in January and the sixth consecutive monthly gain. This rally has been largely attributed to central banks and investors diversifying their portfolios by increasing their allocations to real assets outside the U.S. dollar. Escalating geopolitical tensions and global economic concerns have further amplified gold's appeal as a safe-haven asset.

Despite the overall positive sentiment, analysts also acknowledge potential downside risks. UBS, for instance, projects a modest decline to $5,900 per ounce by the end of 2026, particularly after the U.S. midterm elections. A hawkish stance by the U.S. Federal Reserve could also exert downward pressure on prices. The bank's analysis includes an upside scenario where gold could reach $7,200 per ounce, while a downside case could see it falling to $4,600.

Several factors are expected to influence gold prices in the coming days. Lower U.S. real rates, ongoing global economic concerns, and uncertainty surrounding U.S. domestic policy are likely to continue supporting prices. Central bank policies, geopolitical events, and overall market dynamics will also play a crucial role. Instability, including military tensions and economic sanctions, tends to increase demand for gold as a hedge against geopolitical risks.

However, some analysts urge caution, citing potential downside risks such as central banks potentially liquidating their gold reserves and shifts in market sentiment that could trigger sharp sell-offs.

Trading Economics' global macro models and analysts expect gold to trade at $4,938.65 per ounce by the end of the current quarter and $5,209.62 in 12 months. While some analysts predict volatility in February 2026, with a potential trading range of $4,914.81 to $5,719.00, the overall sentiment suggests a continued upward trend for gold in the medium term.