Gold’s explosive surge may mark a generational peak, analyst warns

Wed Apr 01 2026

Despite the gold market's continued improvement with prices sustaining above $4,500 per ounce, Mike McGlone, senior market analyst at Bloomberg Intelligence cautions investors that the high reached in January might signify a generational peak. Gold prices climbed to a nearly two-week high on Wednesday.

This increase was driven by a weaker dollar and US President Donald Trump's suggestion that the conflict with Iran might de-escalate within two to three weeks.

A 0.2% decline in the US dollar resulted in greenback-denominated commodities becoming cheaper for those holding other currencies.

Gold's generational peak and shifting role

According to McGlone’s April metals outlook, gold is facing a significant challenge.  This hurdle is attributed to the metal's overextended speculative run earlier in the year. “At the end of February, the metal stretched to its highest-ever level versus the Bloomberg Commodity Spot Index and its greatest premium to its 60-month moving average since 1980,” he was quoted as saying in a Kitco.com report. 

Our takeaway is that gold's parabolic 2025 rally—the best year since 1979—was prescient of the Iran war, and the 2026 high may mirror the 1980s. The peak that year, at about $850 an ounce, held until 2008. Gold is struggling because its role has shifted from a safe-haven asset to a risk asset due to speculative momentum, according to McGlone. 

He highlighted this change, noting that the precious metal's 180-day volatility is currently more than double that of the S&P 500 and is at its highest quarterly level since 2006.

War and hawkish policy drive steepest monthly decline

McGlone maintains a cautious outlook on gold, which is poised to record its most significant monthly decline since the 1980s.  Spot gold was last valued at $4,612.70 an ounce, reflecting a 12.5% decrease for March. At the time of writing, COMEX gold prices were 0.6% higher at $4,705.50 per barrel, and had hit $4,751.26 per ounce, its highest level in more than two weeks. 

Gold experienced its sharpest monthly decline since October 2008, falling more than 11% in March.  This steep drop was driven by increasing expectations for hawkish monetary policy and the dollar's emergence as the preferred safe-haven asset following the outbreak of the Iran war on February 28.

Consequently, traders have largely eliminated the possibility of a US Federal Reserve rate cut this year, a significant shift from the two expected cuts before the conflict began. Higher interest rates weigh on gold demand as the precious metal is a non-yielding asset. 

Silver outlook

Additionally, McGlone suggested that silver's January surge to $120 an ounce, alongside gold's performance, might mark a historic peak.  His analysis highlighted that the silver-to-oil and silver-to-copper price ratios reached unprecedented highs during the first quarter. The silver contract on COMEX was last at $74.440 per ounce, down 0.7% from the previous close. 

McGlone, while generally pessimistic about precious metals, highlighted that the ongoing conflict with Iran introduces substantial uncertainty.  The direction of precious metal prices, he noted, will be determined by the progression of the conflict.

Source: https://invezz.com/