Is gold falling below $4,100 just the beginning? Societe Generale warns the decline is not over yet

[Financial Channel/Comprehensive Report] Due to rising oil prices and soaring U.S. bond yields, gold plunged nearly $170 on Monday to close at $4,114.88 per ounce. Société Générale warned that the rebound in gold prices failed to regain the 200-day moving average, and the downward momentum still prevails; if it cannot regain the recent high of around $4,315 per ounce, the decline may further expand.

Foreign media reported that Societe Generale pointed out that gold prices are currently approaching an important support area. The next support level is around US$4,095. The other US$3,960 to US$3,940 is the range of the lows in June and July, which is regarded as a key area for subsequent trends. If gold prices continue to fall, the market may look for buying orders in the above areas.

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From a technical perspective, Societe Generale believes that the recent rebound in gold prices has always been difficult to stabilize above the 200-day moving average, indicating that the downward trend has not yet been reversed. Among them, the vicinity of $4,315 has become an important watershed to judge whether gold prices can strengthen again. Once it cannot recover, gold prices may further test the support below.

However, Societe Generale has not changed its view on gold's mid- to long-term trend. The bank believes that the central bank's continued buying of gold, expectations of lower real interest rates, the weakening of the U.S. dollar, and the return of gold ETF funds can still provide support for gold prices. Global gold ETF holdings have rebounded to nearly 3,000 tons, which is regarded by Societe Generale as a signal that investment demand has been re-established.

Société Générale said that gold still plays an important role in multi-asset allocation. "Currency devaluation trades" have reappeared in the market, geopolitical fragmentation, and doubts about the fiscal and monetary credibility of the United States have also further dispersed funds from traditional reserve assets. The central bank continues to buy gold and reduce exposure to U.S. government bonds, reflecting support for demand for alternative reserve assets.

Looking forward to the market outlook, Societe Generale maintains its bullish expectations for gold, predicting that gold prices will rise to US$4,750 in the fourth quarter of 2026, US$5,000 in the second quarter of 2027, and further rise to US$5,250 in the third quarter; the average price for the whole year of 2026 is estimated to be US$4,500, and the average price for the whole year of 2027 will be US$5,125.

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