Will Gold Price Collapse Continue? Analyst Called Top, Here’s The Bottom | Gary Wagner

Summary

• Gary Wagner analyzes whether gold's sharp ~18% decline from its January peak is a deep correction or a pivot from a bullish to a bearish trend, noting the market is at a critical technical juncture.
• Technically, gold has broken below the key 50-day moving average (a bearish signal) but remains above the 78% Fibonacci retracement level (~$4568) on his short-term chart, which keeps a "deep correction" scenario in play.
• The central puzzle is that gold is selling off amid elevated geopolitical uncertainty and military conflict, which are typically bullish fundamentals, creating a divergence between technicals and fundamentals.
• His primary explanation for the sell-off is a strategic shift by large money managers and hedge funds out of gold and the US dollar (both traditional safe havens) and into crude oil, seeking better returns due to supply risks in the Middle East.
• He maintains a year-end gold price target of $6,000, expecting the longer-term bullish market sentiment to reassert itself after the current correction.
• On crude oil, he notes $120 per barrel is a critical level where sustained prices would have a "profound negative influence" on consumers and corporations, potentially forcing the Fed to reconsider rate policy.
• Silver is described as inherently more volatile and less liquid than gold, acting as a "far back second" safe haven, which explains its extreme price swings.
• In the near term, given the ongoing conflict, he believes crude oil currently has more upside potential than gold or silver, as it is "outperforming both" and sustaining its gains.