TD Securities has lowered its gold forecasts for the next two quarters, citing rising inflation expectations linked to negative supply shocks that have driven yield curves higher and kept the USD firm. Markets are also pricing a potential Fed hike in late 2026. The bank flagged a downside scenario in which a crude oil surge from current sub-$100\/b levels could pull gold towards support at $4,000\u20134,200\/oz.<\/p>\n
Further out, TD Securities raised its longer-term projections, with a target average gold price of $5,350\/oz by Q2 2027. The updated view assumes inflation pressures ease after the Iran war concludes, allowing interest rates to fall and the dollar to weaken, while demand dynamics would remain supportive through central bank buying and broader positioning linked to financial repression and geopolitical risk.<\/p>\n
Given the current environment, we believe gold faces significant headwinds in the coming weeks. Recent data showing inflation holding firm around 4.5% has pushed the 10-year Treasury yield above 5.1%, strengthening the US Dollar Index to the 108 level. This environment makes non-yielding assets like gold less attractive for now.<\/p>\n
For derivative traders, this suggests a bearish to neutral stance for the third quarter of 2026. We see value in buying put options or establishing bear put spreads targeting the $4,000\u2013$4,200 range, especially if crude oil prices break above the $100\/barrel mark. This strategy offers a defined-risk way to capitalize on potential near-term price weakness.<\/p>\n
Historically, periods of high real interest rates, like the early 1980s, have been challenging for gold prices. With the CME FedWatch tool now indicating a greater than 60% probability of a Fed rate hike by December, market conditions mirror this precedent. Selling out-of-the-money call options could be a viable strategy to generate income while waiting for this pressure to subside.<\/p>\n
Looking further out toward 2027, however, we are positioning for a significant rally. The current headwinds are expected to reverse once geopolitical tensions ease and the Federal Reserve pivots back toward a looser policy. We are beginning to accumulate long-dated call options, such as LEAPS with strike prices around $5,000, to prepare for a potential move toward the $5,350 target.<\/p>\n","protected":false},"excerpt":{"rendered":"
TD Securities cuts near-term gold forecasts on higher yields, firm dollar; sees $5,350 by 2027.<\/p>\n","protected":false},"author":103,"featured_media":16976,"comment_status":"","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[103,6,100,66,81],"class_list":["post-54438","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates","tag-derivatives","tag-gold","tag-inflation","tag-oil","tag-usd"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\n\t\t