Gold Price and Gold Stocks Slide, but the Medium-term Bearish Case is Likely MUCH Bigger

The breakout in the USD Index above the 100 level (which is happening right now) could easily lead to bitcoin’s invalidation of the move above $100k. Both are super-important from the psychological point of view, and both are likely to impact many other markets. And yes, this has implications for the precious metals market through various mechanisms.

USD Index (cash) just moved above 100. The breakout is far from being confirmed, but the biggest bullish confirmation in months is happening while I’m typing this.

The USD Index futures are a bit lower, and still before the move – this further means that the breakout is not a done deal just yet.

Market Blind to Dollar’s Recovery

The thing is that once it is a done deal, many markets could move in a MAJOR way. Gold, silver, mining stocks… But not only them. Copper, bitcoins, and perhaps even the general stock market could slide as well.

Quoting my yesterday’s comments:

We saw a clearly monthly rally in the USD Index in October, but most investors still remains oblivious to what’s going on here. People are still in the “USD = bad’ sentiment, not realizing that it is exactly this kind of sentiment that creates great buying opportunities.

Remember how nobody wanted to touch stocks after their Covid-and-lockdown-based declines? Exactly.

Tariffs are fundamentally bullish for the USD, and yet the latter declined after they were announced in April. Not only should the USD rally back to its April levels, but then rally well above them.

Miners are underperforming on a short-term basis – likely leading PMs lower, and my yesterday’s comments remain up-to-date:

The GDXJ is testing its late-October lows while neither gold nor silver are doing the same thing. The stock market is not sliding today, so that’s not the reason for it. And even if this was the case, then it would likely be impacting both: miners and silver.

So, what we have here is true underperformance of mining stocks. This doesn’t bode well for the following weeks.

Yes, the GDXJ fell from above $110 to below $90 (temporarily), but this is just the beginning of the big decline.

Let me remind you that the stock market hasn’t declined in any meaningful way so far – yet. In fact, it’s still trading very close to its all-time highs. This – along with the explosive potential for the USD Index – amplify the bearish indications that come just from the technical picture for the miners and metals.

The GDXJ just moved below its October lows in tune with my forecast for gold price in Nov. 2025 – congratulations to everyone benefitting from this move.

The situation in gold and silver also remains as it was yesterday (they both moved lower since I posted my yesterday’s analysis):

Gold price appears to be forming a broader short-term top in its resistance zone in a way that’s similar to what we saw in the second half of October. Back then, we saw triple top, and this time, we see three/four tops, depending on how one will count them.

Still, once the USD Index’s rally becomes obvious, gold price is likely to tumble. I already wrote why gold price forecast for November 2025 was bearish previously, and what we see today simply confirms it.

Silver is also correcting its recent decline, and it’s doing so in a way that’s creating a symmetrical pattern relative to how its price moved in early part of October.

Some would say that this is a head-and-shoulders pattern that’s being formed, where a smaller H&S pattern is the head of the new pattern. This makes sense and it shows just how far silver can decline in the short- and medium-term. Long-term-wise, I’m extremely bullish on silver, but it seems to me that its current run-up is over.

Overall, it seems that taking profits from the long-term investments and from half of the insurance capital (in gold and silver) when gold was at about $4,150 and silver was above $50 was a great idea.

Please note that the precious metals market is not the only market where I think the big run-up is over.

I think the same is the case with regard to bitcoin.

Yes. The ‘new gold’ broke below its rising support line, and it verified this breakdown by moving back to this line and then moving lower once again. At the same time, bitcoin invalidated its move to new highs.

Those are powerful sell signals, and since we see them while the USD Index is poised to move higher, it seems that these are the final days when one could get out of bitcoin and most (if not all) cryptocurrencies at very good prices. If you own bitcoin or cryptos, please treat this as a major red flag and a WARNING.

The prices might decline really fast when people realize what’s really going on in the USD (by reading this, you’re already well ahead of them).

On a short-term basis, we see that bitcoin broke below the lower of the rising support lines. This is an additional bearish confirmation. Once bitcoin invalidates the move above $100k in a clear manner, a volatile slide is likely to follow.

This means that it might not be convenient – or even possible – to short the bitcoin market at that time.

This is why I’m shorting it now (and the full version of this analysis includes detailed profit-take and stop-loss levels).

Here’s how it could go down:

1. The USD Index rallies (as it should, based on the very negative sentiment and positive fundamental situation due to tariffs), which triggers PMs, miners and bitcoin’s decline.

2. Bitcoin’s slide scares investors that were heavily invested in all-things-AI. Copper declines as well as bitcoin and copper are quite correlated.

3. Since AI-related and tech companies are what’s driving stock market higher, a sell-off in AI and tech companies triggers a sell-off in the broad market.

4. The sell-off is long overdue, which means that it’s likely to be deep – perhaps just like what we saw in 2008.

5. Precious metals (especially silver) and mining stocks decline even faster, not just because the USD Index is rallying, but because the stock market is sliding – we saw that taking place in 2020 and in 2008. The moves lower in silver and miners (and FCX) can be enormous in such environment.

Copper Joins the Reversal Club

And what is copper doing right now?

It just formed a double top – just like it did in July. This time, the top formed at the 61.8% Fibonacci retracement level – once again proving the importance of those levels.

Copper was able to ignore USD’s gains in the previous weeks, but not so much this week. This perfectly fits my previous comments – namely, that the markets are likely to react when it’s clear that the USD Index is indeed rallying again, and not just consolidating.

It seems to me that we’re in this critical transition stage right now.

Big tops in copper and bitcoin tend to align – not always, but frequently so. And it seems that we saw another top in both recently.

The stock market just moved slightly below its previous high. This did not happen previously in case of more important breakouts – they were not invalidated. This time it’s already different.

Paul’s Volatility Breakout System just turned bearish today. It all might be connected. I’d prefer to see a bigger decline before stating that THE top for stocks is in, but a bigger decline in stocks right now (in the following weeks/months) would fit what other markets are indicating.

Thank you.

Przemyslaw K. Radomski, CFA
Founder
Golden Meadow®