Veteran trader Peter Brandt has warned that gold’s recent surge above $3,000 could carry long-term consequences, as the commodity appears to have entered a “blow-off stage,” a sign the current rally may be nearing an unsustainable peak.
While gold prices may continue climbing, attempting to predict the exact top can be risky and costly, according to Brandt in an X post on April 15.
The four-decade trading expert further warned that such blow-off tops often extend “well beyond a bear’s ability to meet margin calls.”
“Gold has now entered its blow-off stage. Such rapid advancement will come to a terminal top, but attempting to pick a high can be very expensive,” he said.
Blow-off stages tend to last longer than expected, often squeezing out bearish positions through forced margin calls before reversing sharply. This phase typically marks the final leg of a bullish cycle, characterized by parabolic price action and euphoric sentiment.
Brandt backed his outlook with chart insights featuring Comex Gold futures (GCM25), which exploded past the $3,000 level, closing at $3,284 on April 15.
The analysis depicted a “J-Hook” continuation pattern followed by a vertical breakout, pointing to potential parabolic behavior that often defines the final phase of a major uptrend.
Impact of blow-offs on prices
While blow-offs can yield significant gains for those already positioned, they also pose a high risk of a sudden downturn, potentially catching late entrants off guard.
Notably, gold has seen an impressive ascent in 2025, gaining over 25% year-to-date as investors flock to the precious metal for its safe-haven appeal amid escalating trade tensions between the United States and China.
The capital shift to gold comes amid growing fears of a possible economic crash, impacting traditional investment vehicles such as stocks. To this end, global investors are slashing U.S. equity exposure and piling into gold, according to Bank of America’s latest fund manager survey.
The survey indicated that 36% of respondents are underweight on American stocks, the most in nearly two years. BofA also noted that 49% now see “long gold” as the most crowded trade, overtaking U.S. tech for the first time in two years.
Consequently, Wall Street firms such as Goldman Sachs are bullish on the metal, with the bank setting a target of $3,700 for 2025 due to stronger-than-expected central bank demand and recession risks.
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