More than a month has passed since the war in the Middle East catalyzed a massive short squeeze in precious metals markets. Crude Oil markets have melted, erasing the risk premium associated with the war, and yet precious metals prices have remained resilient (it was a bear trap!) in defiance of the traditional playbook pointing to a fading risk premium. Finally, it is time to come to the dark side.

We now see risks that buying exhaustion could soon morph into selling activity. Zooming out, however, macro headwinds may increasingly work against discretionary bears in Gold, but the door is open for some tactical downside.