Gold (XAUUSD) prices are slipping further this week as the market digests a high-stakes, five-day diplomatic window and President Donald Trump's administration’s decision to pause strikes on Iranian infrastructure. This tactical reprieve in the U.S.-Iran war is unwinding safe-haven premiums, pushing gold’s 14-day relative strength index (RSI) into the 20s, which signals the metal is now technically oversold.
On March 23, gold was seen trading about 24% below its monthly peak.
Still, it’s positive for the year at the time of writing as investors balance short-term volatility against long-term inflationary pressures and a shifting global monetary landscape.
Is Now the Time to Build a Position in Gold?
A plunge into the oversold territory often serves as a buy signal for disciplined investors looking to enter the market at a discount.
While the immediate “war premium” has temporarily dissipated, major drivers for bullion remain firmly in place: persistent inflation and a weakening dollar provide a structural floor for prices.
Meanwhile, central bank accumulation continues at a record pace as nations seek to diversify reserves away from fiat currencies.
If the diplomatic window closes without a definitive resolution, gold could reclaim psychological support near the $4,500 level, triggering a wave of short-covering which may propel prices back to recent highs.
How High Could Gold Realistically Fly in 2026?
The long-term bullish narrative for gold is bolstered by significant institutional support.
Late in 2025, JPMorgan’s chief executive Jamie Dimon offered a striking endorsement of the metal’s role in a fragmented global economy, saying “it could easily go to $5,000, $10,000 in environments like this.”
Aligning with the sentiment, his investment firm currently maintains a $6,300 price target on gold for 2026.
Its conviction rests on the belief that fiscal deficits and geopolitical instability will eventually force a re-rating of hard assets, making the current dip potentially attractive to build a position.
Note that bullion held its 200-day moving average (MA) at the $4,100 level this month, reinforcing that the broader uptrend remains intact.
