Fund managers now see gold (XAU) as the most undervalued asset since March 2023, according to a July Bank of America survey. The reading arrives as the metal rises 3.5% in two days from the $3,900-$4,000 support zone.
The last time the survey flipped this way, gold traded below $2,000 and then rose to $5,598 in January. Whether history repeats may depend on the Federal Reserve and a potential truce between the United States and Iran.
Fund managers are turning gold for the first time since March 2023
July edition of Bank of America The Global Fund Manager Study surveyed 181 institutional managers overseeing $484 billion in assets. 6% of them now say that gold is undervalued, the first negative overvaluation reading in more than three years.
The transformation is exciting. During 2025 and early 2026, the same survey showed extreme readings, with 40% or more of managers calling gold overvalued near the January peak.
Sentiments have reset after the harsh repricing. Gold is trading about 26% below its record level, a decline that has already pushed the metal lower Bear market lands earlier this month.
Calculate market data Partchart He highlighted the signal on the X, indicating that gold is now the most undervalued in more than three years. In March 2023, a similar setup preceded a rally that nearly tripled the price.
Cash levels trigger a sell signal everywhere except gold
The evaluation call stands out because managers are not as careful elsewhere. Average cash levels fell from 4.1% to 3.6% of assets, as first reported analysis.pl. Any reading at or below 4% triggers a contrarian sell signal under the Bank of America monetary rule.
The positioning appears to extend across risk assets. 82% of respondents described long semiconductor stocks as the most crowded, while 45% described the AI bubble as the biggest risk. Meanwhile, 83% expect the Fed will not raise interest rates before the midterm elections in November.
Gold is on the other side, unpopular and uncrowded. If a monetary signal precedes a stock correction, only major asset managers who are considered cheap could become natural rotation targets.
One important caveat. The survey lasted from July 2 to July 9, before the collapse of the ceasefire sent oil prices above $90 a barrel and revived the crisis. A hawkish Fed chorus. Managers’ average end-of-year oil price forecast of $71 already looks outdated.
XAU is bouncing off the $3,900 support, but the trend line is limiting the recovery
The daily chart shows sentiment resetting in conjunction with a technical reaction. Gold rose 1.74% on Wednesday to $4,148, its highest close since July 7, after defending the $3,900-$4,000 support zone.
This green zone corresponds to the long-term 0.5 Fibonacci retracement level at $3,943. Buyers entered exactly where the golden ratio suggested, echoing the levels set in previous gold Expectations.
Momentum is quietly improving. The daily RSI is trending higher to 52, returning to neutral territory after weeks of suppressed readings. A similar rebound recently Powered by the breakout in silver.
However, the long-term structure remains bearish. The price is still trading below the downtrend line drawn from the all-time high at $5,598, which is now approaching near current levels.
The first obstacle is the trend line itself. Beyond that, the $4,300 to $4,400 resistance area coincides with the 0.382 Fibonacci retracement at $4,334, roughly 4% to 6% above the current price.
A rejection at the trend line would expose the 0.618 golden pocket at $3,552, about 14% below the current price. The Fed’s decision next week, with markets pricing in nearly 60% odds of a September rate hike, and a proposed 10-day US-Iran truce are the closest catalysts.
Fund managers described gold as cheap. Now the chart must decide whether it is premature or simply wrong.
this post Fund managers say gold is undervalued in 3 years. Is the bottom there? appeared first on BeInCrypto.
