WARNING: Why Everyone is Likely WRONG on Gold Metal

Summary

In this video, the speaker shares a detailed analysis of the current gold market, explaining why a potential pullback is likely. Despite being a long-term believer in gold, the speaker highlights important warning signals, such as overbought conditions and regression channel breakouts, suggesting that the market may be heading for a correction in the next several weeks. With resistance levels nearing, the speaker anticipates a pullback to the 2,800-3,000 range, advising caution and a wait for lower prices to enter the market. This analysis is intended purely for educational purposes, not as financial advice.

Takeaways

• 😀 Gold has surged recently, but there are concerning signals suggesting a potential pullback in the coming weeks.
• 😀 The presenter is a long-term investor in gold and silver, but the video is meant for educational purposes and not as a trading recommendation.
• 😀 A critical resistance level at around $3,280 (1618 Golden Ratio Extension) is currently being tested, with the potential for a correction if reached.
• 😀 Overbought conditions are visible in the market, with the RSI (34) surpassing the 70 threshold, signaling a potential market top.
• 😀 An 'acceleration extreme' signal, triggered by the recent surge in gold, indicates extreme overbought conditions and higher risk of a correction.
• 😀 Gold has moved above the two standard deviation regression channel, similar to previous market tops in 2006, 2008, 2011, and 2020, suggesting a pullback is likely.
• 😀 The price of gold historically pulls back to the middle or lower part of the regression channel when these overbought signals emerge.
• 😀 Previous corrections, after similar signals, saw gold prices drop to around $2,800-$3,000, with potential for deeper corrections depending on the speed of the pullback.
• 😀 The presenter warns that current sentiment around gold is overly bullish, with many new investors entering the market, which typically signals a top.
• 😀 Despite the risk of a pullback, the market could test $3,290 before correcting. The presenter expects a more likely pullback to around $2,800-$2,900 in the coming weeks.

Q & A

What is the main topic of the video?

The main topic of the video is an analysis of the gold market, specifically focusing on the current trends, chart patterns, and potential risks associated with gold investments.

What does the speaker clarify at the beginning of the video regarding their stance on gold?

The speaker clarifies that they are an investor in gold and silver, believe in them as long-term investments, and that this video is not a recommendation to buy, sell, or short gold. It is purely for educational purposes.

What recent experience does the speaker share related to gold investments?

The speaker shares an experience from their trip to Tehran, Iran, where many people who previously showed no interest in gold suddenly recommended buying gold after its price surged.

What levels of gold were the speaker watching for potential resistance?

The speaker is watching the 1618 golden ratio extension levels around 3279 to 3280 and the 100% extension around 3291 as important resistance levels for gold.

What does the speaker identify as an overbullish sentiment in the gold market?

The speaker observes that the sentiment in the gold market is extremely overbullish, with many people jumping into the rally, which they believe increases the risk of a pullback.

What are the warning signs that the speaker mentions regarding potential risk for gold?

The warning signs include acceleration extremes in the market, an overbought RSI 34 setting, and price surging beyond the two standard deviation regression channel. These signals suggest a higher likelihood of a pullback or correction.

How does the speaker interpret the combination of acceleration extremes and overbought conditions?

The speaker explains that when acceleration extremes and overbought conditions (such as the RSI 34 setting above 70) occur together, it indicates potential downside risk and the possibility of a market pullback or correction.

What examples from past gold rallies does the speaker refer to in explaining potential corrections?

The speaker refers to past gold rallies in 2006, 2008, 2011, and 2020, where similar warning signs (overbought RSI, acceleration extremes, and price surging beyond the regression channel) preceded significant corrections in gold prices.

What is the likelihood of gold experiencing a pullback according to the speaker?

The speaker believes there is a higher probability of a pullback in the next several weeks, with the potential for gold to correct to levels around 2900 to 3000, or even lower, potentially down to 2800 or 2832.

What does the speaker recommend for investors based on the current gold market conditions?

The speaker advises caution and recommends waiting for lower prices before considering any gold investments. They emphasize the importance of not following the herd and being cautious of the current overbullish sentiment in the market.