UBS maintains its 12-month forecast for gold at USD 3,700 per ounce by the end of June 2026. This prediction is based on anticipated lower US interest rates, which generally favour non-interest-bearing assets like gold.
UBS also believes that ongoing geopolitical risks will support gold prices. They suggest that reduced real rates will further benefit gold in the near future.
Short Term Perspective Of ANZ
ANZ, taking a short-term perspective, advises monitoring the US jobs report. The expectation is that precious metals, including gold, will see a price rally if the Federal Reserve decides to cut rates in September.
The upcoming US jobs report is identified as a critical factor that could influence whether the current rally in precious metals will continue. This reflects the market’s sensitivity to economic indicators that affect interest rate expectations.
With the market now pricing in an 85% chance of a Federal Reserve rate cut at the September 17th meeting, all eyes are on this week’s jobs report. We believe a non-farm payroll number below the consensus forecast of 150,000 would solidify these expectations. This makes the upcoming data a critical short-term catalyst for gold.
Derivative traders should consider positioning for increased volatility around the announcement. We are seeing elevated premiums on short-dated options, reflecting the market’s uncertainty. A simple strategy could be buying call options to speculate on a weaker-than-expected jobs number, which would likely send gold higher.
Long Term Bullish View
This short-term focus ties directly into the longer-term bullish view for gold reaching $3,700 by mid-2026. A Fed pivot to easing, confirmed by a softening labor market, is the foundational step for that forecast. Lower real interest rates and persistent geopolitical tensions would provide the fuel for such a rally.
For those with a longer horizon, we see value in looking at longer-dated call options. For instance, purchasing the June 2026 calls with a strike price around $3,000 offers a leveraged way to participate in the expected uptrend while defining risk. This aligns with the pattern we observed during the Fed’s 2019 easing cycle, which preceded a major gold rally.
However, we must also prepare for a surprise. If the jobs report comes in unexpectedly strong, it could challenge the rate cut narrative and cause a sharp, albeit likely temporary, pullback in gold prices. In this scenario, holding put options could serve as an effective hedge against long-term bullish positions.
