Can gold prices replicate the surge of 1979? Multiple positive factors make $5,000 a non-dream

The gold market continued its strong performance in the second half of 2025, with a cumulative increase of nearly 55% for the year, potentially marking the largest annual gain since 1979. This spectacular rally not only makes the 2026 gold price突破5,000美元/盎司 a real possibility but also paves the way for challenging $10,000 in 2027.

Global Stagflation Pattern Emerges, Gold Allocation Value Demonstrates

Currently, the global economy exhibits typical stagflation characteristics—slowing growth alongside persistent inflation. In this environment, the value of gold as a hedge asset is being reassessed. From the perspective of different currency valuations, gold has not only hit a record high in USD terms but also remains near historical highs when priced in AUD, GBP, EUR, INR, and JPY, reflecting a consensus among global investors.

Three Major Structural Support Forces Drive Gold Prices Upward

Central Bank De-dollarization Boosts Gold Strategic Reserve Demand

After the Russia-Ukraine conflict, global central banks have seen a significant surge in demand for gold. Many central banks are actively reducing their exposure to the USD and other major reserve currencies, shifting towards increasing gold holdings. Currently, the average proportion of gold reserves among central banks is about 20%, with China at only around 8%, aiming to raise it to 30% in the long term. This allocation trend is expected to continue over the coming years, providing a steady stream of institutional demand for gold.

Enthusiasm from Investors Releases, ETF Holdings Reach New Highs

This year, gold ETF holdings have increased by 17%, with institutional investor participation significantly rising. Against the backdrop of traditional 60/40 investment portfolios (stocks/bonds) facing inflation erosion, exchange rate fluctuations, and geopolitical risks, more fund managers are choosing to strengthen their portfolios’ risk resistance by increasing allocations to commodities like gold, silver, and copper.

Interest Rate Cut Cycle Approaching, Policy Environment Turns Favorable

According to the Federal Reserve’s forward guidance tools, the probability of initiating a new rate cut cycle in 2026 is almost certain. While the specific timing remains to be confirmed, the policy direction is clear. An environment of rate cuts typically lowers real interest rates and diminishes the dollar’s attractiveness, which is a positive signal for non-yielding gold.

Seasonal Trading Window: Seize the Historic Opportunity in February

Historical data reveals an interesting pattern: buying gold futures contracts in late November for delivery in February of the following year, and closing positions by late January, often yields substantial returns. Based on this seasonal pattern, the following trading framework is proposed:

Trading Instrument: February 2026 Micro Gold Contract (10 ounces)

Sensitivity to Volatility: $10 profit/loss for every $1 change

Expected Target: $5,000 (after突破, further challenge of $10,000 in 2027 possible)

Entry Point: $4,100

Stop Loss: $3,900

Maximum Loss: $2,000

Potential Profit: $9,000

Traders should roll over contracts in February, June, and December.

Risk Warning: Strong US Dollar and Rate Hikes Combine

The main pressures on gold come from the simultaneous appreciation of the US dollar and rising interest rates. If the Federal Reserve adopts hawkish policies to counteract overheating and inflation rebound, pushing up rates, gold will face downward pressure. However, from the current macro environment, this risk is not a primary concern in the near term; on the contrary, policy support for gold remains strong.