Chris Vermeulen, Chief Market Strategist at The Technical Traders, has warned that gold could be on the verge of a sharp correction reminiscent of the 2008 financial crisis.
He noted that following a historic bull run, gold may face a pullback ranging from 30% to 35%, with some scenarios extending to 45%, based on Fibonacci retracement analysis and historical market patterns.
“It’s going to be more like 2007/2008 where it’s going to be just a sharp violent pullback . <…> I think we have an economic reset and when gold finally does peak it’s probably going to pull back 30%, 34% or 35% somewhere in there,” he said.
Notably, gold has been among the best-performing assets of 2025, with investors turning to the precious metal for its safe-haven appeal. However, in recent weeks, the metal has recorded significant outflows, trading at $4,114 as of press time, up more than 56% year to date.
In an interview with David Lin published on October 22, Vermeulen noted that the peak for gold has not yet been clearly established.
Investors should anticipate the metal reaching a top before a significant correction begins. Using past trends as a guide, a pullback of 20% to 45% is typical during the natural ebb of major asset cycles.
Gold’s sweet spot
Such a correction could see gold’s price retreat to what the analyst described as the “sweet spot,” a range determined by retracement levels between 38% and 61%.
“I do believe, eventually using just Fibonacci retracement based on the size of this run, there is potential for gold to pull back to the sweet spot. And the sweet spot is between a 38% pullback all the way,” he added.
While the correction is expected to be sharp, it is unlikely to last as long as the post-2011 stagnation period.
Vermeulen suggested the pullback could be violent but relatively short-lived, setting the stage for a strong rebound once market conditions stabilize.
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Source: https://finbold.com/gold-set-for-a-2008-style-violent-pullback-warns-strategist/