Transcription
Hey folks, welcome to verifiedinvesting.com. My name is Gareth Soloway, chief market strategist here.
Now, in today's video, we're diving back into gold and silver. Gold is taking a beating today. Silver is down. This is on the back of basically higher tensions in the Middle East, which is causing the US dollar to rise and interest rates to rise as oil moves up. Remember, as oil moves up, inflation expectations adjust higher and therefore rates are floating higher as well. So, this combination is obviously putting pressure on gold and silver to the downside. And we've really seen this in the charts, right? You guys know I've been consistently saying that while we're near a major low pivot, I still think both of these precious metals or semi-precious in the way of silver are going to go lower before we bottom out. We'll discuss that a little bit more per the charts.
Now, before we get into things, just a reminder, folks, that uh you have a chance here to still join the Gareth Top Squad right here on YouTube. It's my premium uh YouTube. You get a couple videos a week for just you as premium members and also a discount code every week. Um, and the one I gave out yesterday is still valid. All right, still valid for 20% off a service in uh at verifiedinvesting.com. So really some great benefits. The idea is is the discount alone pays multiples of the cost of $10 a month for the premium YouTube.
All right, into the action we go here. Let's take a look at gold. Look at gold here today. Big sell-off 2.5% to the downside. And notice the weakness here. So, recently we bounced off this technical support down here around 4,000. The even number makes sense, right? But the bounce, did it ever get up to resistance? No. Just like over here, it didn't get up to this resistance trend line. Now, over here, it did. And then you could see here it hits, you got a big bounce, but it still couldn't get there. Got close, then hit it again and a shallower bounce and then ultimately down we go again. And the idea here is that the chart is talking to us. It is telling us that at least for now, gold remains weak because it can't even go up into the ceiling of resistance here uh before it starts to come back in.
Now, the question will be when and if we break this trend line down here. This is a bigger wedge pattern. Remember how wedge patterns work here, guys? And I'll draw one in here. We have a downs sloping trend line and an ascending or ups sloping trend line. Price starts out wide with big moves, right? Big moves. But as it gets squeezed here, it's getting tighter and tighter that builds like a pressure cooker to the point where at some point we're going to either have a massive breakout or a massive breakdown. Right? So essentially, think about it like the the pressure is building here on gold inside of this wedge pattern. Okay?
Now again I favor still a little bit more downside. Part of that is going to history right and again you could say this time is different but generally human psychology isn't different but if we go to the larger time frame here we can see that back in the 1980 period we had a draw down of 66%. Now I do agree that this period is much different. The the obviously the inflation back then was significant and it's actually not as significant now but you have human the debt of the US right debt of US lack of fiscal controls more uncertainty about kind of just you know the fiat currency system all of these play into roles inclusive of is inflation going to stick around for longer periods which again was there in the in the 80s the early 80s into that top from the late 70s as well but the point again is that this to me if this is has been a cycle top at 50 uh 5600 it still likely has more to go.
What we want to do too is we want to look and see that as time goes on, okay, as time goes on, we have shallower pullbacks. And this is kind of what I what I'm gauging here is that here you had a lot much much lower US debt, right? And and spending and all that stuff right down here. So we had a bigger draw down on gold. That makes sense. 66%. Here we had about a 46% draw down, right? So you can see that as debt and QE was going on here, the draw down was shallower. My guess is is we will see in the 30% draw down on current levels on gold from the recent high. And if we do that, we're looking at basically this 37% which is right at that 3500 level. That's probably your bare market low um of this cycle.
In addition, notice this guys, the bare market cycle. And by the way, I created a calculator I'm going to be debuting on verified investing and also a major institutional research report on gold and when the ne next cycle will occur, how high will gold go? But notice how long this cycle bare market was. It was going from 1980 to really we started to we topped out in 2011. Then from 2011 to 2026. So not notice again this was like 30 years 30 years 31 years this was 15 years and so it makes sense that this could be as short as five years uh before we really get our next peak. Now 5 years is to the peak. Remember that doesn't mean we're not going to go up and take out this high in a shorter period of time which is what I think will happen within a couple years. But ultimately again the idea here is is that we'll peak the next bull market cycle will peak in 5 years and it should be an incredible move. The upside calculator that I created which again you guys will have full access to in not too long on verified investing that'll be uh and it'll be this week sometime I believe. But the idea here is that that that is it's basically projecting out that the next bull market high will be around 13,000 give or take. That's really what I'm finding at least. So again, just something to keep an eye on there. Um and that I mean think about that return. I mean if we do get to 3500 3500 in a matter of I think it was about 5 years potentially uh to get to 13,000 is a very good return. Very very good return. Okay.
So that just gives you a rundown. Flipping back to the daily chart on gold here. Again, gold big down day. We're going to be testing this level here. Uh we're basically at 4,000 now, but this trend line is descending. So, it's inching a little bit lower. This is around 3975. That breaks, we should flush out to this level, which again would be that 37% draw down from this high pivot, which would fit the criteria of a lower a smaller draw down each cycle, but also a draw down of of reasonable amounts as well.
All right, let's go to a couple other things here as we go through. If we take a look at silver, silver is getting pounded here to the downside. And again, nice drop on silver. Silver has support here, but it's only minor. This to me is a bare flag. We did do a break of key support here and here and here. Broke down, retraced, which is exactly what you expect, rejected. And now, basically what you're watching is whether or not we break this right here. This little trend line connecting these lows right through these lows. If we get below basically $58, we should flush to 54 in the coming days. 54 comes. Where do I find that level? Very simple here. In fact, this high pivot right through there, right? So, these two high pivots, that's your next level. It's right around $54 uh per ounce. Now, again, if we get through that, we have another level at $50 and then 46. 46 is basically the low end of what I'm seeing as as your draw down. Doesn't mean it's going to be the low because we know fear and and greed can make things go way below projected logic-based targets. But again, right now, my low end is 46. My high-end target um for like a major low would be 54. And let's be fair, we've already gotten down close to that 54. We got down to 55 and change here. So, we've kind of kissed my my upper range. But, I still think there's one more flush coming in silver. And we'll have to watch and see how that goes. Once we get down to, let's say, 46 to 54, then I'm really going to start eyeing this downs sloping descending trend line because once that breaks to the upside, it should be game on for a much bigger move to the upside on silver.
All right, so that's a rund down there. Let's quickly do platinum and palladium. Um, again, platinum and palladium. I've been swing trading a little, but this again would be my bigger short-term buy zone right in here. I'm kind of eyeing the low end of that just below 1500. That should be significant significant support. And then also if we look at palladium here uh we could see again palladium kissed my upper level. I'm still going to eye right below 1100 as my lower level of significant support on this.
If we go to copper real quick for those of you that love your copper we can take a look here. And copper remains remember everyone was so bullish. I mean, what's crazy here, and we can get rid of that trend line, is that even when we were up here, even the media and analysts were talking about how this is going to this was going to be epic for for copper. And I was like, no, it's at the upper end of a classic parallel. It should get rejected. Sure enough, price got rejected. Now, it's actually making another bare flag here. It should roll over and we should actually head eventually we're heading down to this $5ish area here, which would be the low end of the parallel. And I know that seems crazy, but just imagine this. Imagine if all of a sudden, let's say late this year, early next year, we see a slowdown, a slight slowdown or a plateau on data center buildouts, um the capex maybe doesn't go up as much as people think and the US economy just weakens a tiny bit. What do you guys think's going to happen to copper? Right down, especially economically if we see a global slowdown. So, I think there's good precedence to think copper is actually more favored to the downside in the next 6 to 12 months than to the upside.
All right, guys. I'm still on vacation, but you can see obviously I'm not in um Cancun anymore. Uh I'm back in the US, but now on the Pacific coast, the west coast of the US enjoying a little time out here. Uh after this week, I'm back in the office. All right, thank you guys so much. Don't forget to join Gareth's Top Squad to support my channel. You guys are rock stars. Thank you so much. I'll keep you posted.