Gold Panic Is Here: What Happens Next

panic in the gold market. The predicted waterfall sell-off is happening and it's gaining steam. We're going to look at the technical levels. We're going to look at the next price targets for gold in this waterfall sell-off. I'm going to give you my prediction short term. But then, and this is going to be very important, we're going to take a look at the last super cycle in gold and in the commodities to help you understand what this correction really means in the big picture of this gold bull run. Very important video. Let's get right into it. Welcome to Hot Trades of the Day, your show for swing trading ideas for the coming days, weeks and month. Welcome to Hot Trades of the Day. My name is Daniel Vahami. Let's get right into it. The predicted waterfall sell-off that I've been telling you for weeks to be coming in gold is developing in front of our eyes. We're getting a next leg lower after we broke the 200. It started. We fought with the uptrend a little bit. Remember in the last videos I told you the uptrend is going to break. We're going to go lower. If you hit the subscribe button so that doesn't happen anymore. And now we're getting the next leg lower. Is this it already? In my opinion, this is not it. But we're starting to get to the final phase of the correction and of this waterfall sell-off. The first thing we notice is the candles are getting longer. That is good. As you can see here in this correction, they were all pretty small. Nothing was really happening. Here they're all pretty civilized. But with the waterfall sell-offs, here you can see it, the candles get longer towards the end of the sell-off. So that's what we pay attention to and we're starting to see this. The next levels obviously are around 4100. That is the low from March. And then this blue zone that I've been telling you about around 4000. That goes all the way back to the fall of 2025. As I said in previous videos, I believe we're going to test the 4000. And then things will start to get really interesting. Because if we use the 4000, like I'm a big gold owner like the central bank of China or Poland. But if gold can hold this area or more likely, as I told you before, undercut it for liquidity grab and then rebound quickly, then that would signal the end of the correction. Now the other option, we talked about it before, is we're going to go all the way down to 3500. The breakout level from this big consolidation, which by the way, went from April all the way to August. People tend to forget this correction, which was quite long and was really tiring. Because they only remember the massive up move that happened then in the fall, winter and then obviously in January. So long correction we get to this in a minute. Our normal in a gold bull market. We need to remember this. Now from the top to today, we're down about 25% in about five months. That hurts. And let me do some housekeeping here. Obviously, I've read the comments of some of you that are hurt, that are upset, that are way underwater with their mining stocks and don't know what to do and are wondering if they should just chug it and buy semis and AI stocks because that is going up. I'm going to talk about this in a special video this Saturday for the free newsletter. So if you're a member of the VIP newsletter, we're going to address this on Saturday in a special video. If you're not a member, you can sign up for free. The link is in the comments. It's free. We're not going to spam you. You're going to get about a video a month with quality content concerning the markets, like in this case the situation if you got in early with the mining stocks. Now back to gold. So I believe looking at the charts and looking at the development and the price action that we're getting towards the final stage of this correction. You look at the RSI down at the bottom. You see we're at 27 now. So we're in oversold territory. And if we look back, then you see we had something similar here. That was obviously the March low. And then we go back in time and look when was the last time that we had an RSI this low. This was right here. And as you can see, that was the low of the 2024 correction period, which went from October all the way pretty much to January. But the low was already in November. And then if we go further out, we can see obviously we have this way oversold RSI here. This is 2023. Mark the low as well. Here we had the low of this down move, but obviously had the second sell off coming right afterwards. Either way, an RSI that's this oversold usually signals at least the bounce is going to come pretty soon. And that would make sense. Now, is this bounce the turnaround? Ideally, what we would love to see is gold on the cuts to 4000, liquidity grab, panic in the market. Everybody is giving up on gold. Because remember, this is really, really important. What people tend to forget is, if you have a correction in a bull market, and it's a strong bull market, everybody wants to buy the dip. Just think of crypto and Bitcoin, when Bitcoin was running, everybody was buying the dip. So what happened? Oh, no real corrections. Nvidia, same thing. Max 7 stocks, same thing. In order for a correction to be really healthy, and really wash out the weak ends, and really lay the foundation for the next leg up, meaning you push out so many investors that you have all this fresh capital that's standing on the side that then needs to buy again, when gold goes higher. And let's face it, they're not going to buy at gold 4200, they're going to buy at gold 6200. The correction must feel like this is the end of the bull market. That is what it has to feel like. Otherwise, people are not selling. And that's exactly where we're getting at. I can see it in the comments, I can hear it in talks with people that I have that say the same thing. They're like, well, it was a good run, but this is over. This was the peak. This is not the peak. This is an intermediate high. They say, well, gold's down 25%. It's a bear market. Technically, they're right. But here's what they like to forget. They forget the crazy hype that happened in January. Remember what happened in January. We had central banks buying, we had the gold bull market, and all these people were not in it, especially in the US, especially institutions, especially family offices. So they all had to buy. And then the crypto bros jumped on gold, and especially on silver, because the crypto sector wasn't working. And they were leveraging positions 8x, 10x, going long, gold, but even more so silver. And that pushed up the prices. We were at 5600 by the end of January. If you watched my video in the beginning of the year, about the gold market and my prediction for gold, my two targets for 2026 were 5000 target 1 and target 2, 5500. We hit that pretty good, but not in December. In January, we had a complete hype in the precious metals. Basically, front running on the fundamental side, the decline in the dollar and rate cuts. That had to be And that's exactly what's happening. So yes, we're down 25%. But we were down 25% from a hype level that we shouldn't have been at in the first place. Probably should have been really realistically, this zone right here, which is around $1,000 less, so 4,600. And you see it because this was an important zone where we then turned around after the first waterfall sell off end of January. And we bounced around it. But even if we go up and we say it's 4,800, that's fine too. If we take 4,800 as a fair gold price to be at in January and we go down, now all of a sudden we're down 15%. A lot different. So a large part of the correction is in gold and in silver, even more so, that we're seeing right now, is just correcting the hype. The air had to be let out of the balloon. Now it's happening in crazy ways, especially in silver, no doubt. But that's how silver usually works. It's extremely volatile. It's a tight market. It's a small market. And it also gets heavily manipulated by the institutions that are sitting on these large short positions. We know this. So we have a hype air out of the balloon. And then we have a correction because, well, the rate cuts are not coming. Because what nobody could see coming is Iran war slash street of Hormuz closed. So all of a sudden, I expected the oil price to go up. You know this. If you watch this channel for a long time, I recommend it to get into energy stocks last fall, winter, when nobody was talking about it. We made bank with it. If you miss these videos, subscribe button will really help out so you don't miss these videos. I did not expect we would be at oil 120 this early in the year and that we will hold elevated levels in oil continuously for a month, which, by the way, is really positive for gold long term because it's going to increase inflation. It's going to increase deflation risk. Right. It's just short term. And this is important. This is an important factor we're getting to right now. Short term, the trend for gold is down. And I've been telling you for years, if you follow this channel for a long time, the majority of institutions lack the knowledge in the commodity sector. So they just use simple trend following models and the trend for gold is down. And why do I know that that is the main driver right now in gold? Well, we look at the factors that are influencing gold. Okay. The dollar is actually cooling off. So that would be positive for gold. But nothing is happening. We look at oil. Oil has taken a nice dive in the past week. That's positive for gold because that decreases the chances of rate hikes. Nothing has happened in gold. Oil doinked off the 50 day and then sold off. That looks good if you're a gold bull or an oil bear. Nothing positive has happened in gold. Let's look at the bond market. Stabilizing, right, but not moving up after this structure that built out. You would think that's for gold. No, nothing is happening. Gold is selling off. So the only reason why gold is selling off is trend following models. And if that is the case, then we need to look at really at the support zones, because that is where a lot of the shorts that are short now, that are trend short, will start covering their positions. And those two levels are the March low, the pink line you see right here, and then the round number, this blue zone around 4000. So with that, these are the target zones we're going to look at. And then we will see how gold will react. My ideal scenario for gold would be something like this. Now, this is 2022. So this is a little bit different because we're at the end of the bear market overall in the stock market, but also in gold and the commodities. So we broke the 200. We get a sell-off. We get a waterfall sell-off here. Oversold in the RSI. We get a rebound. Didn't even make it to the 200. Get another leg lower. Undercut this low. Liquidity grab. But we already make a higher high in the RSI. And then we form some real structure and off we are. That would be the ideal scenario, because that would be the type of bottom that the shorts will then say, okay, we need to cover and we need to get out of here. Now, let's look at the last super cycle and let me show you and give you some data. So I'm switching to the monthly here and you can see this is the last super cycle, 2001 to 2011. So as you can see in these boxes, I highlighted all the big corrections that we saw in the gold super cycle. Now, gold went up around 660% between the lows of 2001 and then the highs 2011. And I was in it pretty early, because I was actually buying gold on September 11th, 2001, after the second airplane hit the World Trade Center. Look at these corrections. Six of them. Two of the six had corrections of 30% in gold. Not the mining stocks. In gold, the physical metal. These six corrections lasted over seven months. They just washed out the weekends. But what happened after all these corrections? Gold went up a lot and it went a lot higher after all of them. And remember, please, if you see here the golden line, this is 200 monthly. The purple line, it's 50 monthly, not the daily. So don't confuse that and think like, wait, we're below the 200 day. That's a completely different scenario. What I want to show you is in a super cycle, correction phases, long correction phases are normal. Look at this. Here, 2006, for like a year, I think it was 14 months, we did basically nothing in gold. That just let a lot of people throw in the towel. But if you sold and you probably didn't get into again at a good price, you would have kicked yourself for the coming years. We are already five months into this consolidation. And this, by the way, is the reason why I have been saying the end of this correction is going to be in consolidation. It's going to be this summer, likely June. We'll see if it's June. But if it's July or August, then we're definitely in the range of seven to eight months, which again, last super cycle was exactly the time that these corrections lasted. Twice 30% corrections in the gold price. That hurts. It's tough. No sugarcoating it. But that's normal. And that's what we need to deal with. Especially when we have a hype phase like we had in January, that also needs to be corrected. So we have double air that needs to be let out of the balloon. So I know it feels like the gold and silver rally is over and the bull market is over and that's it. But look at the fundamental facts and compare them to December. You can even compare them to January. I don't care. And we see with the exception of the bond market turning, that the fundamental situation for gold now is actually better than it was half a year ago. The central banks are buying. I talked about it in previous videos. Again, if you missed it, subscribe button. They're still buying. Gold has overtaken the US dollar as the number one reserve for central banks now. That wasn't the case in six months. You could see it coming, but it wasn't the case yet. It's there yet. So the decline of the dollar is happening. We don't see it right now because we have short to medium term dollar strength because of Iran and because, well, the rest of the world, suck it Europe, is really weak. It's basically among the blind, the one-eyed is king. But the mid to long-term demise of the dollar is happening. And on the other hand, gold is gaining more value in the central bank system. Inflation is rising, not only on the energy side, which by the way, is sustainable. If you look at the predictions of the energy markets, not only for AI data centers, which by the way, will be causing a huge problem in the energy markets, especially in the US, which means big time opportunity for us to make money, which will be on here at Hot Trades of the Day, hit the subscribe button, so you're part of it, but also food inflation. The stagflation risk therefore is rising because the economy, guess what? Not doing great if you count out big tech, which in itself will, and we notice already, lay off more and more people thanks to AI. It's cannibalizing itself. All these factors, better now than they were six months ago for gold. Again, exception, bond market. So if this is the case, then this is not the end of the gold bull market. This is one of these events that you see here in the orange squares. A nasty, a painful, an annoying correction in a bull market, and we will see higher gold prices in the future. That's it for today. Have a great day. Talk to you later. Bye-bye.