Gold bull market holds, pullback offers entry

February 06, 2026 (MLN): Gold is poised to regain upward momentum after a brief phase of consolidation, with prices projected to climb toward $6,200 per ounce by mid-2026 as resilient central-bank purchases, renewed exchange-traded fund inflows and persistent geopolitical and fiscal uncertainties continue to reinforce its appeal as a long-term hedge.

In the near term, however, heightened volatility and tighter futures margin requirements are expected to keep the metal fluctuating within a $4,500–4,800 per ounce range, which signals a pause in the rally rather than a structural shift in direction, according to a new research report by UBS Switzerland AG and UBS AG Singapore.

The recent sharp sell-off towards the end of January 2026, in which gold fell as much as 12% intraday before closing about 8.5% lower followed U.S. President Donald Trump’s nomination of Kevin Warsh as the next Federal Reserve chair and marked the steepest one-day decline in 13 years

Despite the magnitude of the drop, gold remains up roughly 13% year-to-date, highlighting the resilience of its longer-term uptrend even amid sudden policy-driven volatility.

The correction came just a day after prices had reached record highs, which emphasizes the increasingly fragile trading environment in precious metals.

Warsh’s reputation for favoring monetary discipline and balance-sheet restraint initially fueled fears of a hawkish policy shift, prompting broad market repositioning.

Historical comparisons in the report suggest that such abrupt declines do not necessarily signal the end of a gold bull market.

Previous cycles have typically concluded only when central banks restored full credibility through sustained high real interest rates and structurally stronger currencies, conditions that analysts argue are not yet in place.

Instead, the current environment more closely resembles mid-cycle corrections seen in past decades, where temporary pullbacks were followed by renewed rallies once macroeconomic uncertainties resurfaced.

The absence of persistently elevated real yields, coupled with ongoing fiscal deficits and geopolitical tensions, continues to provide a supportive backdrop for gold demand.

In the short term, technical pressures are expected to remain influential.

Major exchanges have increased margin requirements for gold futures, raising the cost of leveraged positions and contributing to near-term selling pressure.

 Nonetheless, longer-term demand projections remain firm, driven by expectations of continued central-bank accumulation, steady retail buying of bars and coins, and renewed exchange-traded fund interest  factors are likely to reassert themselves once volatility subsides.

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