Precious Metals Trader & Investor Technical Analysis
Good evening, traders and investors.
A relatively quiet day for equities — indices closed mixed, with the S&P 500 and Nasdaq flat, while small caps (Russell 2000) lagged. Large-cap tech remains near all-time highs, but participation continues to narrow — a typical late-stage sign where big money hides in mega-caps while smaller stocks stall.
The real action today came from precious metals, where we saw a full-on meltdown across the board.
Precious Metals: From Euphoria to Exit
Gold suffered its biggest one-day decline since 2013.
This was the same area where we locked in our discretionary gold trade profits a couple of weeks ago at the Fibonacci target — and as noted then, we were entering “no man’s land” where price could swing +4% to -4% daily.
That’s exactly what played out today.
- Gold, silver, and miners all reversed sharply lower.
- Silver miners (SILJ) were hit hardest, down over 11% on panic volume.
- This looks like a crowded trade unwinding, as latecomers who chased the move are now capitulating.
Remember: the smaller the asset and the more speculative the sector, the bigger the swings.
Silver and its miners can deliver outstanding runs — but they also correct violently.
Perspective & Market Cycle Parallels
If we step back, today’s pullback in gold fits neatly into the 2008 analog we’ve discussed:
- Then, both gold and the S&P hit new highs together.
- Gold saw a sharp initial selloff, stabilized, then launched higher as stocks rolled over.
We may be in that same stage now — a short-term shock within a longer-term setup.
Once equities weaken again, gold, silver, platinum, and palladium could easily lead the next upside surge.
For that reason, I prefer the physical metals or direct ETFs (like GLD, SLV) over miners.
Miners are still stocks and will suffer alongside the equity market if volatility expands.
Sentiment & Behavior
Today’s volume in GDX, GDXJ, and SILJ shows fear-driven liquidation — likely a mix of:
- Profit-taking from early longs, and
- Panic selling from FOMO buyers who entered late in the move.
This is normal in bubble-type phases.
Once the emotional dust settles, gold and silver could stabilize and stage their next leg higher — but volatility will remain intense.
Bonds & Defensive Rotation
Bonds continued to firm, acting as a partial safe haven while equities tread water.
The monthly chart of TLT still suggests a basing process — slow, but constructive.
As risk appetite fades, we should see bonds reclaim their defensive leadership again in the months ahead.
Key Takeaways
- Equities: Flat and indecisive
- Gold: Biggest one-day drop since 2013; volatility entering peak phase.
- Silver & Miners: Hardest hit; classic crowded-trade washout.
- Bonds: Slowly turning defensive; early signs of base forming.
Bottom Line
Today’s selloff in precious metals wasn’t random — it was a classic emotional shakeout after weeks of FOMO buying.
Gold’s long-term trend remains bullish, but short-term volatility is peaking.
If history rhymes, we could soon see gold resume leadership as equities weaken — but until that confirms, patience and position management are key.
Talk soon, and trade safe.
Chris Vermeulen
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