JP Morgan Predicts $6,300 Gold After Historic Crash
By John Nada·Feb 2, 2026·3 min read
JP Morgan raises its gold price target to $6,300 following a historic crash in metals. Retail demand remains resilient despite the volatility.
Gold and silver have just suffered their worst declines in decades, with gold falling below $5,000 and silver crashing 31% in a single day. The catalyst? President Trump's nomination of Kevin Warsh as Fed chair, whose hawkish reputation sparked profit-taking across the metals markets. This sent the dollar soaring and liquidity drying up, forcing leveraged traders to exit their positions. Despite the chaos, gold is still up 8% this year, while silver has gained 16%. The fundamentals driving these metals—geopolitical risk, currency concerns, and record debt—remain intact.
Chinese speculators played a crucial role in both the metals' historic rally and subsequent collapse. A frenzy of hot money from retail investors and trend-following algorithms had pushed prices to record highs, reminiscent of the 1979-1980 buying spree. However, as Warsh's nomination fueled a dollar rally, Chinese investors took profits instead of continuing to buy. This shift led to silver's record plunge of 26% in just hours.
Despite the crash, retail demand showed resilience. In Singapore, buyers queued to purchase gold as prices tumbled, viewing the selloff as an opportunity rather than a warning. This trend reflects a broader shift in Asia towards tangible assets amid ongoing currency concerns. United Overseas Bank reported a significant increase in gold savings account purchases and physical gold sales.
JP Morgan responded to the market turmoil by raising its year-end gold price target to $6,300, asserting a 35% gain from current levels. The bank remains optimistic, citing expected official-sector gold purchases of 800 tons in 2026 as central banks continue diversifying their reserves away from the dollar. Deutsche Bank also maintains a bullish outlook, reiterating a $6,000 forecast despite the recent volatility.
In a surprising move, Morgan Stanley has broken from the traditional 60/40 portfolio model, now recommending a 60/20/20 allocation—60% in stocks, 20% in bonds, and 20% in gold. Chief Investment Officer Mike Wilson argues that gold is now the 'anti-fragile asset' to own, especially as fiscal stress reshapes portfolio construction. This strategy acknowledges that gold thrives when real rates decline, positioning it as a critical hedge in uncertain times.
The recent market events highlight a significant shift in investor sentiment and strategy. While some may view the crash as a severe setback, others recognize it as a moment of opportunity. The resilience of buyers in Asia and the bullish stances from major banks suggest a complex landscape ahead for gold and silver investors. As central banks continue to shift their reserves and the market adapts to new realities, the future of precious metals remains a pivotal element in global finance.