To The Moon

We have seen Gold trading above $3,800, would this continue to help the continuation of the precious metal bull market?

There is something I think as investors we should be aware which is the overbought RSI and could this mean that the bullish tone of the precious metal would remain intact?

First, let us have a structured look at the precious metals bull market with gold above $3,800:

1. Macro Backdrop — Still Bullish Drivers

Real rates & Fed policy: Even with “higher for longer,” inflation expectations remain sticky. Real yields are not rising fast enough to derail gold.

Safe-haven demand: Geopolitical risks + slowing global growth keep gold attractive as a hedge.

Central bank buying: Strong central bank accumulation continues (especially from EM nations), providing a long-term floor.

Currency diversification: Dollar weakness or diversification away from USD reserves remains supportive.

2. Technical Landscape

Gold above $3,800: Breakout zone suggests the bull trend is intact. Key supports: $3,650–3,700, then $3,500.

RSI overbought (>70): Yes, gold is extended short term. Historically, RSI >70 often leads to sideways consolidation or shallow pullbacks, not necessarily full reversals in strong secular uptrends.

Momentum regime: In past cycles (2011, 2020), gold stayed “overbought” for weeks while still pushing higher before consolidating.

3. Silver & Other Precious Metals

Silver tends to follow gold with more volatility. If gold holds >$3,700, silver could see outsized percentage gains (catch-up trade).

Platinum & palladium: More industrial-driven, but can benefit if investors rotate into “cheaper” metals once gold feels stretched.

Similar to Gold, we are seeing Silver also in overbought RSI, which could suggest a short-term consolidation.

4. Risks / Why to Be Cautious

Overbought technicals: RSI >70, stretched above moving averages → short-term pullback risk.

Macro reversal: If real yields rise sharply (e.g., Fed stays hawkish into 2026), gold could lose some shine.

Positioning: Crowded long speculative bets can trigger sharp corrections on any news shock.

5. Outlook

Near term (weeks): Risk of consolidation/pullback toward $3,650–3,700 support as RSI cools.

Medium term (months): Bull market likely intact unless gold loses $3,500. Bullish tone can persist with geopolitical, central bank, and monetary backdrop supportive.

Longer term: If central banks keep buying and global liquidity cycles turn easier, gold can sustain the bullish regime, possibly eyeing $4,000+.

Bottom line: The precious metals bull market looks intact, but the RSI overbought condition does raise short-term pullback risk. The bigger cycle drivers (real yields, central bank buying, safe-haven flows) still favor gold and silver on a 3–12 month view.

In the next section, we have drawn up a Q4 2025 technical “scenario map” for Gold and Silver, framed bull/base/bear with probabilities:

Gold (current ≈ $3,810)

Bull Case (35% probability)

Drivers: Continued central bank buying, USD softness, safe-haven flows, breakout momentum.

Technical signal: Sustains above $3,800 and clears $3,900 resistance.

Target zone: $4,050–4,150 (+6–9%).

Risk: Blow-off top potential if RSI stays extended.

Base Case (45% probability)

Drivers: Overbought RSI leads to consolidation, but long-term bullish tone intact.

Technical signal: Holds above $3,650–3,700 support.

Trading range: $3,650–3,900.

Outcome: Sideways consolidation into year-end, building a base for 2026.

Bear Case (20% probability)

Drivers: Real yields rise on hawkish Fed, dollar strengthens, or crowded long liquidation.

Technical signal: Breaks below $3,650 support.

Target zone: $3,400–3,500 (–8–11%).

Outcome: Would shake weak hands but still above long-term bull trendline (~$3,200).

Silver (current ≈ $47.20)

Bull Case (40% probability)

Drivers: Follows gold higher; industrial demand + investor catch-up trade.

Technical signal: Breakout above $48.

Target zone: $52–55 (+10–15%).

Risk: Volatility — gains can reverse quickly if gold consolidates.

Base Case (40% probability)

Drivers: Gold consolidates; silver chops within range.

Technical signal: Holds $44–45 support.

Trading range: $45–50.

Outcome: Builds energy for a potential 2026 breakout.

Bear Case (20% probability)

Drivers: Gold breaks support; silver’s higher beta amplifies selling.

Technical signal: Break below $44.

Target zone: $40–42 (–10–15%).

Outcome: Would reset sentiment but keep multi-year uptrend intact.

Final Note

Gold: Bull market intact, but near-term risk of consolidation. Probabilities favor sideways with upward bias.

Silver: Still the higher-beta play; can overshoot both ways. Catch-up trade makes its bull case probability slightly higher.

Here are the visual scenario maps for Q4 2025:

Gold: Bull zone $4,050–4,150, Base $3,650–3,900, Bear $3,400–3,500.

Silver: Bull zone $52–55, Base $45–50, Bear $40–42.

The dashed line shows today’s price, with shaded areas marking the probability-weighted zones.

$SPDR Gold Shares(GLD)$ $iShares Silver Trust(SLV)$

Summary

The precious metal bull market remains largely intact even with gold trading above the $3,800 mark, driven by persistent demand from global central banks diversifying away from the U.S. dollar, expectations of further U.S. Federal Reserve rate cuts, and escalating geopolitical/economic uncertainties.

However, technical indicators, specifically the 14-day Relative Strength Index (RSI), frequently show gold in overbought territory (readings above 70, sometimes near 75 or higher). This RSI reading is generally seen as a caution flag, suggesting that a short-term consolidation or a "healthy" corrective pullback of 5-10% is increasingly probable.

Despite the technical warning, most analysts view any short-term retracement as a buying opportunity within a multi-year uptrend, not a reversal. The fundamental drivers, which include strong institutional buying and safe-haven demand, are considered powerful enough to keep the overall bullish tone intact, with many forecasts targeting $4,000 and beyond.

Appreciate if you could share your thoughts in the comment section whether you think precious metals bull market can remain intact even though both Gold and Silver have RSI overbought signal.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire @MillionaireTiger appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.