Gold (XAUUSD) prices are slipping further this week as the market digests a high-stakes, five-day diplomatic window and President Donald Trump's administration’s decision to pause strikes on Iranian infrastructure. This tactical reprieve in the U.S.-Iran war is unwinding safe-haven premiums, pushing gold’s 14-day relative strength index (RSI) into the 20s, which signals the metal is now technically oversold.
On March 23, gold was seen trading about 24% below its monthly peak.
Still, it’s positive for the year at the time of writing as investors balance short-term volatility against long-term inflationary pressures and a shifting global monetary landscape.
Is Now the Time to Build a Position in Gold?
A plunge into the oversold territory often serves as a buy signal for disciplined investors looking to enter the market at a discount.
While the immediate “war premium” has temporarily dissipated, major drivers for bullion remain firmly in place: persistent inflation and a weakening dollar provide a structural floor for prices.
Meanwhile, central bank accumulation continues at a record pace as nations seek to diversify reserves away from fiat currencies.
If the diplomatic window closes without a definitive resolution, gold could reclaim psychological support near the $4,500 level, triggering a wave of short-covering which may propel prices back to recent highs.
How High Could Gold Realistically Fly in 2026?
The long-term bullish narrative for gold is bolstered by significant institutional support.
Late in 2025, JPMorgan’s chief executive Jamie Dimon offered a striking endorsement of the metal’s role in a fragmented global economy, saying “it could easily go to $5,000, $10,000 in environments like this.”
Aligning with the sentiment, his investment firm currently maintains a $6,300 price target on gold for 2026.
Its conviction rests on the belief that fiscal deficits and geopolitical instability will eventually force a re-rating of hard assets, making the current dip potentially attractive to build a position.
Note that bullion held its 200-day moving average (MA) at the $4,100 level this month, reinforcing that the broader uptrend remains intact.
On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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