Even if gold prices consolidate next week, the rally is far from over
Gold and silver prices are ending the week in record territory; however, momentum appears to be topping out, with prices down from their record highs.
After a solid rally, spot gold futures are heading into the weekend below $4,600 an ounce. Spot gold last traded at $4,582.20 an ounce, up 1.6% on the week, but prices are down 1.2% from Wednesday’s intraday high.
Silver is experiencing similar price action, but the volatility is significantly more extreme. Spot silver last traded at $88.69 an ounce, up nearly 11% for the week, but down 5% from Wednesday’s peak.
While we’re only two weeks into 2026, gold is seeing its best start to any year in history, with the market up $256 so far this month. Prices have rallied 5.6% in the last two weeks but still have a ways to go to beat last year’s start, as gold prices rallied more than 7% in January.
The silver market is also seeing its biggest new-year gains in history, with prices up nearly $17.50 so far this month. In the last two weeks, silver prices are up more than 24% and are on track to see their best percentage gains since 1983, when the gray metal saw a gain of 26% in the first month of the year.
Given the gains gold and silver have seen so far this year, combined with momentum from the second half of 2025, analysts have said it is difficult to forecast what will happen next, but a quiet period of stability would be healthy.
“For me, gold holding around $4,600 still reads as classic consolidation after a year of relentless strength,” said Neil Welsh, Head of Metals at Britannia Global Markets. “From my perspective, this isn’t a market running out of steam; it’s a market rotating, rebalancing, and deciding where the next wave of performance will come from.”
Welsh added that it’s not surprising that both gold and silver have stopped to take a breath, as data this past week have provided no new urgency for the Federal Reserve to change its current wait-and-see monetary policy stance.
According to the CME FedWatch Tool, markets see little chance of a rate cut in the first quarter of the new year.
“After such a strong 12-month run, some investors are asking whether gold’s near-term upside is more limited and whether other metals or different asset classes might offer better risk-reward for the next leg. That rotation doesn’t undermine gold’s structural bid, but it does mean the market is more selective about chasing highs,” he said.
Lukman Otunuga, Senior Market Analyst at FXTM, said that even if gold has entered a new consolidation period, it doesn’t change the broader market trends.
“Fundamentals remain firmly in favour of gold due to concerns over the Fed’s independence, trade drama, and steady central bank buying,” he said. “Focusing on the charts, prices remain firmly bullish, but the RSI is heavily overbought. Sustained weakness below $4,570 may trigger a selloff toward $4,500 and possibly $4,450 before bulls regather strength. Should prices breach $4,645, gold could rally toward the next key milestone at $4,700.”
Elior Manier, Market Analyst at OANDA, said that both gold and silver could face growing headwinds as the market becomes crowded on the buy side.
“While fundamentals remain structurally bullish, technical signals are increasingly pointing toward a potential slowdown,” he said. “Banks, hedge funds, and even people not interested in markets are issuing ever-higher year-end price targets—a classic sign of euphoria. Ecstasy in any asset class can precede a brutal comedown, especially when positioning is one-sided; a minor pullback can quickly trigger cascading stop-loss liquidations.”
Manier added that growing expectations that the Federal Reserve’s next rate cut won’t come until June will also dampen demand for precious metals in the near term.
“Even if the trend stalls or corrects, the global landscape is fundamentally different than it was just a few years ago,” he said. “Do not expect a return to 2021–2022 prices anytime soon—but be aware that in a parabolic market, brutal corrections are common.”
However, not all analysts expect gold to consolidate, as geopolitical uncertainty remains elevated.
“Geopolitical tensions are high, and the reality is that an attack is imminent on Iran, no matter what the tweets are telling us, as the reality is a bit different. So, for us, investors looking to hedge, gold is their primary choice,” said Naeem Aslam, Chief Investment Officer at Zaye Capital Markets. “Looking at things, we believe that $4,700 is highly possible this month.”
Geopolitical tensions could be elevated next week as the annual World Economic Forum kicks off. President Donald Trump will be speaking in Davos, Switzerland on Wednesday.
Market volatility could also pick up with the release of the final U.S. GDP data and the Personal Consumption Expenditure Index for December.
