The analyst explains that gold has already reached key targets around $3,700 and $4,100 and is now entering a parabolic phase. He suggests that once gold peaks, possibly near $5,000, it will likely undergo a major correction to remove short-term speculators and stabilize prices. Bank of America has raised its target to about $5,000/ (or higher) by 2026, while also warning of a possible correction along the way. According to the World Gold Council, gold broke above the $4,000/oz milestone in October 2025 and the pace of the rally has been very aggressive, a signal that the market may be in a “parabolic” leg. Some technical-analysis sites argue that the breakout is consistent with entering a “third historic bull phase,” projecting potential upside toward $6,000–$8,000 or beyond if the parabolic momentum continues. After this consolidation, a new upward leg could emerge, potentially driving gold as high as in the next phase of the bull market.
Chris Vermeulen, a seasoned market analyst, trader, and founder of The Technical Traders, explains that while the last quarter often brings a “holiday rally,” current market behavior shows gold entering a parabolic, late-stage move similar to 2007, when precious metals surged before a major top. Massive inflows and record volume indicate widespread FOMO, making this a risky time to buy, as the rally could soon exhaust. He warns that when momentum fades, gold could face a sharp correction, especially if panic hits the stock market, since in major sell-offs, even safe-haven assets like gold are liquidated. Structural factors such as interest-rate movements, the strength of the U.S. dollar, and central-bank behavior could moderate or reverse the rally if conditions shift. Investors are piling in, central banks are buying, inflows are large and rising, all signs of broad participation rather than early-stage accumulation. Technical indicators suggest we may already be in the late-stage territory of a strong up-leg, which increases the risk of a sharp reversal rather than a steady ascent. Chris believes though gold might continue rising short-term, a significant pullback of 20–30% could follow, creating a better re-entry point later.
Credit to : Metal Investors