Gold Breaks $2,900 and Key Resistance Level in Bull Market Run

Gold has been on a long bull run from $35 in the early 1970s to recent highs above $2,900. It’s been driven by inflation cycles, central bank policy, and economic uncertainty. Today gold is near key psychological and inflation-adjusted resistance. Investors and analysts are debating if this rally has more room to run or if a correction is coming.

Forecasts vary wildly. Major banks are looking for a measured rise and are setting targets between $2,550 and $3,000 with an average of $2,871. But gold has already broken at $2,900 this month, so it’s already hit those targets for 2025. Independent analysts are more aggressive and many are looking for $3,000-$4,000 this year. Some say if the bull cycle extends gold could go much higher with some projecting as high as $30,000.

Gold Cycles and Market Drivers

Looking back gold’s trajectory has been defined by major economic events. The 1970s gold rush occurred after the collapse of the Bretton Woods system which un-pegged gold from the US dollar. Prices rose from $35 to nearly $800 by 1980 as inflation skyrocketed and investors sought safety.

The 1980-1999 period was a long consolidation. High interest rates allowed central banks to control inflation and strengthen the dollar making gold less attractive. Gold traded in a range with $400-$500 being resistance as capital flowed into stocks and bonds.

Gold’s 2000–2011 bull market saw a major breakout, fueled by China’s commodity demand, a weaker U.S. dollar, and low interest rates. Prices climbed from $250 to just under $1,900 by 2011, as inflation fears and financial instability drove safe-haven buying.

The 2011–2015 correction was marked by the Federal Reserve tapering its post-2008 quantitative easing (QE) program and gradually raising interest rates. Gold fell to about $1,050, as investors rotated back into stocks and risk assets.

Since 2016, gold has been in a renewed uptrend, supported by ultra-low interest rates, rising geopolitical tensions, and steady central bank buying.

In 2020, the pandemic acted like a turbo boost for gold prices, driving them over the $2,000 mark. On top of that, central banks in China and Russia have been buying more gold, which has increased demand even further.

Figure 1: Price of Gold (1970-2025) (US$/oz) and Recessions in Grey Stripes

Source: macrotrends.net

Important Price Points

Gold’s past price movements suggest several levels where buying or selling pressure has emerged:

• $1,900–$2,000: From 2011 to 2023, this level served as resistance, but it has since been broken. Sustained closes above it reinforce bullish momentum.
• $2,300–$2,600: Technical trendlines suggest that if gold holds above $2,000, this could be the next key area of resistance.
• Above $3,000: A psychological threshold. Many analysts see this as a near-term target, while some predict much higher levels depending on macroeconomic conditions.

Bank Forecasts for Gold in 2025 – Measured Optimism

Banks are taking a more conservative stance on gold’s price trajectory. Their estimates range from:

• $2,550 (Low) – The most cautious forecasts assume some correction.
• $3,000 (High) – The most optimistic among major banks.
• $2,871 (Average) – The consensus that gold has already reached.

Goldman Sachs recently revised its outlook, pushing its $3,000 forecast to mid-2026, citing slower monetary easing and weaker ETF inflows. Deutsche Bank, JPMorgan, and Citi remain bullish but expect prices to stay within the $2,550–$3,000 range in 2025.

Figure 2: Price of Gold (1970-2025) with Trend Lines (US$/oz), Price in Log Scale, and Recessions in Grey Stripes

Source: macrotrends.net

Independent Analysts Forecast for Gold – More Bullish

Outside of major banks, independent gold analysts take a stronger stance. Most expect $3,000 to $4,000 per ounce in the next year, though longer-term projections vary widely:

• Luke Gromen and Jeff Clark predict $3,000+ in the short term.
• Don Durrett and Imaru Casanova see $3,250–$3,500 by late 2025.
• Clem Chambers and Florian Grummes suggest $4,000+ if the bull cycle holds.
• Pierre Lassonde, Stephen Leeb, and James Rickards estimate much higher long-term targets, ranging from $8,000 to $30,000 per ounce.

These higher forecasts focus on key drivers, such as Central Banks buying of gold, inflation, US debt, and financial instability.

Inflation Adjusted Perspective

One way to see if gold has more room to run is to look at the past highs in real terms. The 1980 peak of $850 is roughly $2,700 in today’s dollars. Gold is testing this inflation-adjusted resistance.

If gold breaks above its inflation-adjusted high it will be new territory – potentially a sign the market is entering a longer bull run.

This could also be a point where profit taking emerges like in previous cycles.

Where Gold Goes Next

Gold’s path will be a mix of:

• Monetary Policy: If the Fed cuts rates further gold will go up. A pause or rate hike will slow down.
• Inflation: Persistent inflation will push gold up as investors hedge against currency devaluation.
• Central Bank Demand: Ongoing central bank buying will be a long-term driver.
• Geopolitical Risks: Rising tensions or financial instability will trigger safe haven demand.

At current levels, gold is already challenging its historical highs. If it maintains momentum, $3,000 appears to be the next logical target, with a potential upside beyond that will depend on how long the cycle lasts. But as history shows, when gold moves, it tends to move fast, whether up or down.

Figure 3: Price of Gold (1970-2025) (US$/oz), Inflation Adjusted, and Recessions in Grey Stripes

Source: macrotrends.net