Gold is framed as a mid- to late-cycle correction inside a still-live bull market, with price sitting on the bull market support band after roughly a 30% drawdown from the highs. The setup hinges on the Fed: markets still price a December hike and one more next year, but a weak risk-asset tape could price out that second hike and support gold into year-end. Silver, metals, and BTC are all used as cross-checks, with gold expected to outrun silver until new highs, then silver to catch up, while BTC weakens versus gold as risk assets roll over. The larger call is that gold likely bottoms before risk assets, then works back near the highs by mid-2027 at the latest; if it does not, the framework gets reconsidered.
Gold is about 7% above the prior low and sits at its bull market support band, defined here as the 20-month SMA and 21-month EMA.
Seasonality in 2026 is lining up with 2022 and 2018, when gold also began rising around this point in the year.
Markets still price one rate hike in December and one more next year; after the NASDAQ’s 15% drop, if risk assets keep falling, that second hike could get priced out and act as a tailwind for gold.
Late-2018 SEP guidance penciled in two 2019 hikes, and zero of those hikes actually happened, used as the template for how expectations can unwind fast.
Gold is being treated as a mid- to late-cycle correction, not proof that the larger bull market is over; even if the band fails, it is expected to act as support for a few months.
The current gold low is being compared with October 2008, when gold made one monthly close below the bull market support band and reclaimed it the next month.
Tomorrow’s inflation report could temporarily derail the setup if it prints very hot, but the base case is that gold carves out lows over the next few months and turns higher into year-end.
Only one more rate hike is expected after the one already penciled in; gold is expected to be back near its highs by mid-2027 at the latest, or the thesis gets reevaluated.
Silver may confirm via a back-test after breaking out; it has already taken a 60% drawdown, versus a 90% drawdown example in 1982, and the analogy is the 1970s: spike, drop below the band, then years of chop before another leg up.
Metals are expected to outperform silver near term, with gold leading until it makes a new all-time high, after which silver is expected to catch up.
A recession-style warning is tied to a chart described as the 2-year yield minus interest rates, with 2008 cited as one of the few times it reached this height.
Gold is expected to bottom before risk assets do; if it already has, risk assets should follow within weeks to several months, but if gold has not bottomed yet, the low in risk assets may be delayed.
In 2008 gold bottomed in October while stocks bottomed in March of the following year; in 2022 gold bottomed in September, stocks in October, and BTC in November; in 2018 gold bottomed in August and both stocks and BTC bottomed in December.
BTC valuation versus gold is still in an uptrend, but the expectation is that BTC gets rejected versus gold and falls back to the range lows, likely through a mix of BTC dropping and gold rising, as it did during the FTX collapse.
The broader metals bull market is treated as unfinished and likely to run higher into the end of the decade; 2026 is being cast as a reset year similar to 2022, with gold already down about 30% versus about 22% in 2022, versus 34% in 2008 and 25% in 2006 before new highs.