DUBAI – Gold rally dazzled Pakistan, UAE for years and it may be nearing its breaking point. After months of hovering around record levels, experts now warn that gold’s shine could dim dramatically, with prices potentially collapsing by hundreds of dollars per ounce.
On August 25, gold in Dubai opened at Dh405.5 per gram, down slightly from Dh406.25 at the weekend close. Other variants followed suit, with 22K at Dh375.5, 21K at Dh360.25, and 18K at Dh308.75. Internationally, spot gold slipped to $3,364.76 per ounce, fueling fears of a deeper correction.
Alex Kuptsikevich, chief market analyst at FxPro this tedious sideways movement is about to end, and the fallout could be massive as Gold is heavily overbought. The downside potential is enormous, possibly down to $3,000 or even $2,200 per ounce.
The warning comes just months after gold smashed records above $3,500 per ounce amid de-dollarisation, central bank stockpiling, and strong demand from investors. But the tide may be turning. Central banks have slowed their buying, ETF inflows are drying up, and investors are eyeing a stronger US dollar as the Federal Reserve treads carefully on monetary easing.
Adding to pressure, US President Donald Trump’s push to end the Ukraine war could remove one of gold’s biggest catalysts. If the Fed turns aggressively dovish, gold could soar to an eye-watering $4,600 per ounce, a scenario Kuptsikevich calls “extreme but possible.”
