The Iran war is in its seventh month, yet gold has fallen 7% in a month. Should I sell my gold ETF now, or buy more?
2026-10-05
Why gold is falling in wartime
Gold hit a record $5,589 on January 28 and has since fallen about 26% to $4,162.30, including -7.0% over the past month alone. On 9/28 it fell -3.84% in a single day to its lowest since early August.
War headlines move gold for a few weeks; interest rates move it for years. The January peak was a premium added when war fears were greatest. When the same crisis comes a second time, the price reaction is smaller than the first. Meanwhile, the Fed raised rates in September and the 10-year has reached 5.277%. Gold pays no interest, so the higher the risk-free rate, the greater the opportunity cost of holding it (Regards of Wall Street, 2026-07). The Dollar Index, up 2.8% over one month, also weighed on gold.
Those selling gold and those buying are different
| Who | Recent behavior | Time horizon |
|---|---|---|
| Gold ETF investors | 45 tonnes of net outflows in Q2. About 298 tonnes of ETF holdings underwater around $4,000 | Months. Sensitive to rates and the dollar |
| Central banks | 289 tonnes bought in Q2 (+62% YoY). 45% of 76 surveyed plan to increase holdings | Decades. Buy more the cheaper it gets |
(GoldSilver, 2026-06-25; FXStreet/ING, 2026-07-31)
What this setup means is that both the floor and the ceiling are firm. Central banks support prices near $4,000, and on rebounds, ETF holdings that climb out of losses get sold. A prolonged $4,000-4,500 range is likely.
What the signals say
Based on strategy signals, GLD does not yet meet buy conditions.
| Date | Close | 10-day MA | 50-day MA | 150-day MA | Entry condition | From peak |
|---|---|---|---|---|---|---|
| 9/28 | 377.91 | 393.98 | 395.62 | 411.14 | Not met | -23.21% |
| 9/29 | 382.89 | 392.85 | 395.93 | 410.53 | Not met | -22.20% |
| 9/30 | 380.84 | 391.76 | 396.05 | 409.91 | Not met | -22.62% |
| 10/1 | 382.76 | 390.20 | 396.12 | 409.28 | Not met | -22.23% |
| 10/2 | 380.14 | 388.10 | 396.29 | 408.59 | Not met | -22.76% |
The close is below the 10-, 50- and 150-day moving averages, and the 150-day keeps falling. The distance from the trailing baseline is also in the -7% range, so there is no basis to say the trend has turned. The 10-day MA dropping to around 388 and narrowing the gap with the close is, at most, a sign that the pace of decline is slowing.
So, sell or buy?
The answer depends on your purpose.
- Gold held in a small allocation as crisis insurance should be kept. That allocation was meant not for returns but to avoid falling together with stocks, and central bank demand supports the downside
- Gold bought to play a rebound calls for resetting your stop-loss. For gold to rise again, it needs either a signal that the Fed is done hiking or escalation, and the 10/7 FOMC minutes and 10/15 PPI are the tests
- New buyers should buy in stages only after confirming that GLD's close reclaims the 50-day MA (about 396) and that the 10-year falls below 5%. Days when gold spikes on war headlines are days to wait, not to chase
- If you are considering gold miners (GDX) instead of gold, note that on 10/2, when gold was -0.95%, GDX was +1.20%. Because miners react to falling costs (lower oil) before gold prices, they may fall less than gold while oil is declining
You can find detailed charts and signals for other tickers on the /signals dashboard.