To The Moon

Last week, gold saw a sharp correction after hitting a record high of 5,595.4 USD per ounce, briefly falling to 4,460 USD.

Today, gold has moved back above 5,000 USD per ounce, with an intraday high of 5,092.3 USD. Over the past two trading days, prices have rebounded by more than 8.5%.

Silver experienced an even more violent move. At its peak, silver briefly surged above 121 USD, before suffering the largest single-day drop on record, plunging 26.9% to 79 USD. The decline was significantly deeper than that of gold. Today, silver has reclaimed the 90 USD level, marking a recovery of 13.2%.

Among physical gold ETFs, $SPDR Gold ETF(GLD)$ rose 6.4% on the day and $Gold Trust Ishares(IAU)$ gained 6.2%, closely tracking the rebound in spot gold prices. Gold miner ETFs showed more moderate gains: $VanEck Gold Miners ETF(GDX)$ rose 4.3%, $VanEck Junior Gold Miners ETF(GDXJ)$ gained 4.7%, and $iShares MSCI Global Gold Miners ETF(RING)$ increased 4.4%, indicating that mining equities remain constrained by broader equity market risk sentiment in the early stage of the rebound. Leverage amplified volatility, with the 2x leveraged gold miner ETF $Direxion Daily Gold Miners Index Bull 2X Shares(NUGT)$ up 8.4% and $Direxion Daily Junior Gold Miners Index Bull 2X Shares(JNUG)$ rising 9.7%.

Silver-related products outperformed gold overall. $iShares Silver Trust(SLV)$ and $Abrdn Silver ETF Trust(SIVR)$ both gained 6.2% on the day, while silver miner ETF $Global X Silver Miners ETF(SIL)$ rose 6.5%. The 2x leveraged silver ETF $ProShares Ultra Silver(AGQ)$ surged 12.0%, making it the most volatile and responsive product in the rebound session.

Garfield Reynolds noted that the previous surge in gold and silver prices was extremely rare in historical terms, and that a correction was “a pullback waiting to happen.” He emphasized that the issue was not a deterioration in fundamentals, but rather that prices had risen too fast and deviated from long-term valuation anchors in the short term.

Ahead of the correction, leveraged exchange-traded products and concentrated call option buying played a key role in pushing gold and silver prices higher. When the market turned, these same instruments rapidly amplified losses, triggering stop-losses and forced deleveraging, resulting in a cascading sell-off. This was the direct technical reason behind last week’s abrupt market breakdown.

Why did silver fall so much more than gold?

Compared with gold, silver is a higher-risk precious metal with greater volatility. It tends to rise faster during rallies and fall harder during corrections. The earlier surge in silver pushed the gold–silver ratio below its long-term average.

As the ratio rebounded quickly after dropping below its historical mean, it signaled that silver’s prior outperformance was being repriced. In simple terms, the rebound in the gold–silver ratio reflects a structural correction of silver’s excessive gains, rather than a reversal of gold’s long-term bullish trend.

On the macro side, rising geopolitical tensions and the upcoming Federal Reserve leadership transition have been key drivers of recent precious metals volatility. In early 2026, a series of aggressive U.S. actions — including tensions with Venezuela and Greenland, frictions with the European Union, and new tariffs imposed on South Korea and Canada — prompted global capital to rotate toward relatively stable assets such as precious metals.

At the same time, news that Donald Trump nominated Kevin Warsh as the next Federal Reserve Chair triggered an immediate market reaction, leading to a sharp pullback in gold and silver prices. The market widely interpreted the nomination as signaling a more hawkish monetary policy stance, which pushed the U.S. dollar higher and increased the opportunity cost of holding non-yielding assets. This became one of the key catalysts behind the sell-off.

The episode highlighted how sensitive markets have become to future policy expectations. News analysis suggested that the Warsh nomination triggered the sharp decline in precious metals because investors had previously priced in a more accommodative policy path, which would have helped suppress real yields and weaken the dollar, thereby supporting gold’s appeal as a safe-haven asset.

However, the political backdrop has not weakened long-term demand for gold. On the contrary, persistent geopolitical tensions, growing concerns over U.S. dollar credibility, and doubts about the stability of fiat currency systems continue to drive institutions and central banks to include gold in strategic reserves and asset allocations.

TD Securities strategist Daniel Ghali stated in a report that forced selling in precious metals markets may have largely run its course. He noted that extreme volatility over the past week may push some retail investors out of high-risk markets, but that this also means passive selling pressure is easing, creating conditions for a rebound.

In terms of price outlook, Deutsche Bank reiterated its view that gold could still rise to 6,000 USD per ounce. Goldman Sachs said in a report that its revised year-end target of 5,400 USD faces “significant upside risk,” and that the recent correction has not undermined the medium-term trend. Several major banks, including J.P. Morgan, continue to maintain bullish forecasts, projecting gold prices could reach 6,300 USD per ounce by the end of 2026, driven by sustained demand from central banks and institutions for gold as a safe-haven and reserve asset, even amid sharp short-term volatility.

Compared with gold, Bank of America’s EMEA head of commodities trading Niklas Westermark acknowledged that gold has a stronger and more durable long-term investment thesis, while silver remains more volatile. He emphasized that elevated prices and market turbulence may affect position sizing, but do not change investors’ perception of silver as a high-beta, high-risk asset.

Gold-related ETFs:

$SPDR Gold ETF(GLD)$ is a physical gold ETF that directly tracks spot gold prices, offering deep liquidity and strong trading depth. It is more suited for trading and hedging purposes, with a management fee of 0.40%.

$Gold Trust Ishares(IAU)$ is also a physical gold ETF with a structure similar to GLD, but with lower holding costs, making it more suitable for medium- to long-term allocation. Its management fee is 0.25%.

$VanEck Gold Miners ETF(GDX)$ primarily invests in large-cap gold mining companies, offering amplified exposure to gold prices while also being affected by company fundamentals and equity market volatility. Its management fee is 0.50%.

$VanEck Junior Gold Miners ETF(GDXJ)$ focuses on junior and mid-cap gold miners, providing even greater price leverage during gold rallies but with higher drawdown risk. Its management fee is 0.50%.

$iShares MSCI Global Gold Miners ETF(RING)$ tracks a more diversified global gold miners index, with lower single-stock concentration. Its volatility sits between GDX and physical gold ETFs, with a management fee of 0.39%.

$Direxion Daily Gold Miners Index Bull 2X Shares(NUGT)$ is a 2x leveraged gold miners ETF that magnifies daily movements in gold mining equities. It is suitable for short-term trading but not for long-term holding, with a management fee of 0.75%.

$Direxion Daily Junior Gold Miners Index Bull 2X Shares(JNUG)$ is a 2x leveraged junior gold miners ETF, with even higher volatility than NUGT and extreme risk–return characteristics. Its management fee is 0.75%.

Silver-related ETFs:

$iShares Silver Trust(SLV)$ is a physical silver ETF that directly reflects silver price movements, offering strong liquidity and suitability for trading-oriented strategies. Its management fee is 0.50%.

$Abrdn Silver ETF Trust(SIVR)$ is also a physical silver ETF, but with lower fees, making it more appropriate for medium- to long-term holding. Its management fee is 0.30%.

$Global X Silver Miners ETF(SIL)$ invests in silver mining companies, offering higher volatility and leverage than physical silver, while being influenced by mining company fundamentals. Its management fee is 0.65%.

$ProShares Ultra Silver(AGQ)$ is a 2x leveraged silver ETF that magnifies daily silver price movements, suitable for short-term trading rather than long-term holding, with a management fee of 0.95%.