Why gold prices could be headed for a pullback

With gold near all-time highs, one market expert warns it may be acting more like a risk asset than a safe haven.

Transcript

00:00If you're expecting this day of reckoning for live cattle futures because of the momentum

00:04chasing, does that mean you expect something similar to happen to the stock market, to Bitcoin,

00:09to gold as well, all of which are near all time highs? I think these assets are very vulnerable.

00:16I think there's the potential for a pretty big fallout in each of those. I feel the most

00:22confident about gold. And the reason being, I think that the gold market, I've seen this action

00:27before. I've seen all of these types of excessive headlines before. That was in 2011 when gold

00:33peaked out and took a 45% haircut and took a decade to recover. So gold is a safe haven sometimes,

00:40but not always. I believe that these prices, gold is actually a risk asset, not a safe haven.

00:46It doesn't pay dividends or interest. It's at all time high prices. And if the dollar bottoms out,

00:51like I think it will, that's going to push gold down. Let me just put it in perspective.

00:56If the dollar trades identical to how we did in Trump 1.0, which so far it's following that playbook,

01:03if that happens, we should see the dollar index trade up to 108, 110. That alone, all else being

01:09equal, pushes gold below 3,000. So you want to be really, really careful if you're a gold bull up

01:14here. It's a time to take some money off the table and wait for a big pullback because the pullbacks in

01:19gold can be very treacherous. As far as the stock market goes, you know, on my charts, I see pretty

01:26good resistance around 6,500, which were basically there. And when I look for support, I don't see

01:30good support until we get into the 5,000, like low 5,000. So in my mindset, there's a lot more risk

01:37than reward in the stock market. But of course, you know, this is a market that's been on fire

01:41and maybe it just keeps going up. Momentum tracers are hard to deter. So, you know, I'm not going to

01:47try to predict anything, but I will say we are on some shaky ground. And if and when there is a pullback,

01:53it could be maybe not quite as scary as what we saw in April, but something similar.