Gold price dropped below $4,000 an ounce on Friday for the first time since July, hitting a low of $3,986.85.
Just 3 weeks earlier, a major Wall Street bank had named that level as a floor for the metal. Banks and analysts have offered conflicting views on how far gold could fall.
How Thursday’s Tech Selloff Reached Gold
AI worries hit US tech stocks on Thursday, pulling the Nasdaq Composite down 2.60% to 26,008.86. The S&P 500 lost 1.21%. The Dow Jones Industrial Average, however, ended nearly flat, which kept the selling concentrated in tech.
Gold sold off alongside those stocks, falling $116 on the day, economist Peter Schiff noted. Market account Bull Theory estimated that gold and silver together shed over $1.3 trillion in value.
BREAKING: Gold just crashed below $4,000.
— Bull Theory (@BullTheoryio) October 23, 2026
Over $1.3 TRILLION has been wiped out from gold and silver since yesterday.
Gold falls to a 3-month low while silver drops to its lowest level in 11 months. pic.twitter.com/7m04oxX2Xc
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Justin Lin of Global X ETFs told Bloomberg the drop looked like a “liquidity-driven selloff.” In sharp downturns, he explained, investors often sell gold to cover margin calls.
The same AI worries could also give gold some relief. They have cut bets on another Fed hike, with Bloomberg putting next week’s odds below 10%. Lin said that a softer rate outlook should support the metal in the near term.
At press time, gold traded at $4,002, down 7.4% from its January 1 level. The breach puts earlier forecasts of $4,000 support to the test, with banks and mining executives offering different views on how far gold could fall.
Bulls and Bears Draw New Lines Below $4,000
Earlier this month, Morgan Stanley’s Amy Gower called $4,000 a floor for gold. She based that view on central bank buying, lower bond yields, and cheaper oil.
Data released since then shows central banks kept buying. Goldman Sachs estimated central banks bought 79 tonnes in August, Fortune reported. Provisional World Gold Council data cited by the FT puts September buying near 63 tonnes so far, the most since November 2024.
However, continued buying has not prevented gold prices from falling. Endeavour Mining chief executive Ian Cockerill expressed uncertainty about the $4,000 level at an FT event this week.
“Is $4,000 the floor? I don’t know. But if it isn’t, it’s pretty damn close for the next leg up in the gold price,” Cockerill said.
Below $4,000, Lin sees the next critical test at $3,900. Bank of America has set its line lower still, earlier flagging a possible $3,750 low. It also forecasts a $4,000 fourth-quarter average.
Notably, some analysts expect gold to recover quickly from here. Lin still sees a V-shaped rebound, citing lower rates, a faltering AI trade, and a weaker dollar.
Schiff went further. He argued that traders bracing for a tech wreck are wrong to expect gold to fall with it.
“Gold already corrected. A stock market crash will be bullish,” he said.
Benjamin Cowen of IntoTheCryptoverse struck a more patient tone. He sees gold in the late stages of its bear market, though it could struggle longer.
The Fed meets on October 27 and 28. A hold would give gold the rate relief Lin expects, while a surprise hike could bring the $3,900 test closer.
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