This Looks Like 1980: Gold and Silver Enter Blow-Off Madness

Gold (XAUUSD) price has risen to over $5,500 in a very short period and silver prices have gone ballistic to over $118. Both assets are trending vertically with bullish momentum which is not seen in entire history. This strong move in both metals has raised questions about whether this move is a sustainable breakout or beginning of a terminal blow-off phase. This article addresses whether the current bull market is at its final point or it is the start of something greater.

The Parabolic Rise That Shocks the Market

Gold jumped over $566 in a single week to close above $5,550 which makes over 10% gain in single week. Meanwhile the silver price also surged and settled above $115.

These strong moves in both assets indicate that there is an ongoing transition from structural bull market to speculative mania. This transition is observed from the chart below which shows that the gold price has been trading within a strong trend since 2023. This trend is defined by the ascending channel pattern.

This trend is very strong until the Q4 2025. However, the breakout in January 2026 has broken the ascending channel. The price gains of last two weeks indicate a very abnormal move within the parabolic trend. This move indicates that the gold price is lifting from bullish trend toward something extremely dangerous.

Blow-Off Behavior: Lessons from 1980 and 2011

In the 1980s, both assets experienced vertical spikes before strong collapse. Gold topped near $850 while silver rally touched $50. The same blow-off event also occurred in 2011, but moves were not as aggressive as in 1980. Now, in 2026, both assets are producing a similar move but with higher momentum.

One of the biggest similarities in these moves is that the RSI level has already reached the crisis level, which has been seen historically, where the gold and silver markets have produced a top and reversed lower.

Currently, the monthly RSI in gold is at 96 while silver is at the 95 level. These RSI levels are associated with panic and indicate that when the top is produced in both assets, the market can try to produce around 50% drop from market highs.

Gold’s Structure Break: From Triangle to Vertical Rally

The gold structural breakout from $4,400 indicates a powerful move towards $5,400. The weekly chart below shows a similar ascending triangle pattern since 2024. The breakout each time has triggered around $1,000 per ounce in gold market.

However, the formation of the ascending triangle from October 2025 to January 2026 was very short. This short duration and breakout indicate a quick move in January 2026. The last two weeks’ move was very strong which hit the target of $5,400 in a very short span.

The quick move above $5,400 increases the chances of a blow-off event.
If this event triggers, then the gold market may continue to form a top within the next few days or weeks to produce a strong drop before the next move higher.

Silver’s Breakout Is Even More Violent

Despite the strong move in the gold market, the silver market is also showing alarming situation after the strong breakout from $50. This level was set in 1980 and 2011 highs. The breakout from this region has triggered a massive rally in the silver market, which has taken prices above $100. The monthly RSI in the silver market is also approaching the same levels as in the gold market, which also indicates a blow-off event.

RSI at Crisis Levels: What History Tells Us

The monthly RSI is used to gauge the market emotions. The above chart shows that the RSI is currently at levels above 95 which indicates a crisis situation.

The same technical situation last time shows the following events:

• 1979-1980: Oil embargo, inflation, Cold War tension
• 2011: stimulus bill after crisis, debt ceiling
• Now (2026): World distrust, Inflation shocks, Debt crisis, Capital flight from fiat

During the above periods, the RSI was a tipping point. Therefore, the metals market is entering a critical situation where the risk of correction may develop.

The chart below further shows extreme rally of over $1000/ounce after the breakout from $4260, which indicates the development of blow-off events.

Macro Backdrop: Why This Is Happening Now

The rally in gold and silver is not taking place in a vacuum. The following macro and geopolitical conditions are contributing to this surge.

• De-dollarization trends as central banks accumulate gold
• Escalating tariffs and political shocks in the West
• Increasing levels of debt and fiscal pressure in the U.S. and Europe

Declining confidence in systems based on fiat and increasing interest in hard assets

Moreover the liquidity environment has turned to one of monetary easing and falling real yields which is a perfect storm for precious metals.

Is This the Top? Or a Pause Before More Mania?

Based on the above discussion, the gold and silver markets are currently entering the panic stage where the risk is increasing. It is too early to call a top or correction in both metals, as the momentum remains strongly bullish. But the signs of a technical correction are developing in both metals.

It is still possible that the gold market multiplies by a big number to produce a top before any meaningful correction in both assets. Or it is also possible that the correction in both assets remains short-term and stabilizes at higher levels. However, the current level in both assets is abnormal and indicates a dangerous situation in both assets.

The strong key targets for both assets remain $6,000 and $150 in gold and silver, respectively. As always, blow-off events don’t die on evaluations; they die on exhaustion. The key events of 1980 and 2011 must be kept in mind before entering the short term positions. The long term trends in gold and silver remain strongly bullish towards the $10,000 and $300, respectively as long as gold remains above $4,000 and silver remains above $50.