Market Recap – Stocks, Silver & Gold

While most major markets appear to be gearing up for a continued macro uptrend after a strong recovery from the tariff sell-off, final confirmations are yet to be seen. 

While gold, silver and stocks might be setting up for a bullish rally, now isn’t the time for complacency. It’s prudent to continue tracking these markets closely as in this final phase of the 18.6-year land cycle most assets have historically risen together amid increased liquidity, leverage, and risk appetite before a broad-based financial crash.

S&P 500

With one of the strongest V-shaped recoveries in recent history, the S&P 500 has bounced off its macro 50% level since the tariff sell-off - and is currently attempting to break to all-time high prices. 

While it’s prudent to be on the lookout for a macro higher low, until proven otherwise, the recovery so far has been incredibly strong. Although a continued macro uptrend seems likely, astute investors might soon be hunting macro tops in most major stock markets. This corresponds with the timing window of the 18.6-year land cycle (with a window of 2024-2028 and an average expectation of early 2026 for a macro peak).

DXY

The US Dollar Index, on the other hand, has broken below its own macro 50% level and has so far been unable to regain it. This shows relative weakness in the US dollar.

Most often, the DXY will have an inverse correlation to US stocks and gold. A falling DXY tends to coincide with increasing liquidity and risk appetite in financial markets.

Russell 2000

A barometer for risk appetite among market participants is the strength of the Russell 2000 small cap index which has more speculative, smaller market cap companies outperforming for short periods when the market is risk-on.

Amid the tariff sell-off the Russell 2000 fell below its macro 50% level as the markets went risk off. Having recently recovered this 50% level, for multiple consecutive weekly closes, we can note an early sign of strength in this market - a clear indication that risk appetite is starting to re-enter financial markets.

Gold

While stocks sold off during the tariff panic - gold rallied upwards. 

After putting in a strong rally while other markets sold off, gold has recently been consolidating as the other markets are recovering from their sell-offs.

Recently having broken out from its consolidation, gold appears to be potentially gearing up for its next leg higher. 

Silver

Silver is leading the charge on this next leg up while gold has been consolidating. Silver has recently rallied 10% with the gold-to-silver ratio seeing a decline by 10 points. While the GSR has remained elevated amid gold’s recent outperformance, there is a significant catch-up trade in silver.  

While most assets could rally together in this final phase of the 18.6-year land cycle uptrend, gold and silver continue to outperform after the peak and the crash while most other assets spend years struggling to recover.

With silver’s recent outperformance being just a teaser of what’s to come, historically silver has truly taken centre stage, outperforming gold after the macro crash, during the recovery phase. 

Navigating this final phase of the uptrend, the crash and the recovery phase is extremely tricky using stocks or land, however gold and silver both provide a longer-term investment vehicle to effectively navigate the current liquidity-driven phase - as well as the flight to safety phase that follows.