The gold market is entering a dangerous phase that could turn into years-long stagnation for investors. According to the analytical model of Bloomberg Intelligence senior strategist Mike McGlone, the peak in the precious metal expected in 2026 could trigger a scenario that mirrors the trajectory of oil after its historic 2008 high. For those who bought the metal at local tops, this means a long road to recovering their positions, and for observers, it is a strong argument not to rush into the market.
Parallels with the 2008 oil bubble
The key to understanding the risk lies in price dynamics. A barrel of WTI traded around $90 on November 6, almost repeating the 2007 level, followed by a jump to $147 in 2008 and a prolonged decline. By McGlone's logic, price itself becomes the main driver of supply and demand cycles, and a sharp vertical rise is almost always followed by a decade-long fall. The peaks in gold and silver in 2026 look even more extreme than the 2008 oil surge.
The analysis confirms: in 2026, gold cost roughly 2.1 times more than its average price over the previous five years. The metal demonstrated a similar gap only in the 1970s, and after the 1980 peak it did not return to its former highs until 2007. Currently, gold exceeds its five-year average by about 1.5 times.
Where the price could pull back to
The average annual closing price over the past 10 years is about $2,271 per ounce. With a typical market reversion to the mean, quotes could drop to around $2,300 — a potential decline of almost 44% from the current $4,050. For holders of bars and coins bought on the wave of records, such a scenario threatens a long wait to get back into profit. Holders of US Treasuries, by contrast, could benefit: according to the strategist's estimate, these securities will begin to outperform gold in yield.
Politics, central banks and bonds
McGlone links the risks for gold and oil to US policy: by the end of the year, both assets are more likely to decline than to set new highs. The weakening of Trump's position in the November 3 midterm elections may mean that the best times for the metal are over — it was precisely the president's limited power in 2025 that supported prices. At the same time, over the short term the elections played into gold's hands: futures rose above $4,000 on November 4 and gained about 5.5% in two days amid a weaker dollar and falling US bond yields.
Central banks are also supporting the price. According to World Gold Council data from November 3, regulators bought 321 tonnes of the metal in the third quarter of 2026 — the most since the end of 2024. Such demand could soften the pullback the analyst warns about. In addition, gold may "pass the baton" to US Treasury bonds: the gold-to-bonds ratio has begun to reverse from a nearly four-decade low — the last time similar dynamics were observed was in 1987.
Cryptalist analysis: The current market configuration points to an asymmetry of risks: the potential for further growth in gold is limited, while the room for a pullback to historical averages remains wide. Institutional investors should assess positions in precious metals through the lens of reversion to the mean rather than the inertia of records, and take into account competition from US bond yields. Continued central bank demand is a key buffer, but it can only slow, not cancel, a cyclical correction.