Podcast: Play in new window
Precious metals came alive this week, with gold, silver, platinum, and palladium all posting strong gains as the U.S. dollar slid back under 100. It was a very different week from the quiet, sideways action of recent months — a welcome surprise driven by a weakening dollar, accelerating gold buying out of the East, and the first real hints of a technical breakout. Let’s take a look at where prices stand as of Wednesday, August 5:
The price of gold is up about 5.5%, sitting at $4,250 as of recording. Gold jumped in just the last day or two and is nudging right up against its previous short-term highs.
The price of silver is up 9.7%, back over $60 and sitting around $62.50. It was up roughly 5% in a single day.
Platinum is up 9.75%, sitting at $1,731.
Palladium is up 10%, currently at $1,361.
Looking over at the paper markets…
The S&P 500 is up 5.7% to 7,717, printing new all-time highs.
The US dollar index is down about 1.7%, sitting just under 100 at 99.72.
Among the commodities…
U.S. oil has settled back near $75 a barrel after a wild round trip.
Copper is up roughly 8% in August, and pushing into new all-time highs of its own.
Gold Keeps Flowing West to East
The single clearest signal this week is the large pools of capital moving East. Chinese gold-backed ETFs just recorded 14 consecutive daily inflows — the longest streak since March — pulling in roughly $1.2 billion over those two weeks. That’s including about $370 million in a single day. Even South Korea has now started buying gold for the first time in over a decade.
Underneath all of it is a growing distrust of U.S. fiscal and monetary policy and the dollar itself. When central banks and sovereign buyers vote with their balance sheets for hard assets over paper promises, that’s a trend worth respecting. If the East is steadily converting paper claims into physical gold, a Western investor building a core physical position is on the same side of the trade as the world’s central banks.
The Fed Boxes Itself In
The Fed has painted itself into a corner, and this week’s data made the trap more obvious. If policymakers want to fight inflation by raising rates, they immediately drive up the interest cost on a national debt now around $40 trillion — effectively shooting themselves in the foot. Yet after five straight years of missing the 2% inflation target, a fifth governor is now reportedly arguing for hikes, and every incoming data point is being read through the lens of the September rate decision.
Adding fuel to the inflation fire is the AI build-out: data centers, semiconductors, and soaring tech valuations are creating money and wealth out of thin air, which feeds through to prices. Even the “good news” jobs report — about 44,000 jobs added in July — came with a sting, as wage inflation ramped up. When a government must keep expanding the money supply to service its own debt, the long-term math favors real money over paper. That’s the core reason to hold physical metals through the noise.
Geopolitics Keeps a Bid Under Gold
Beneath the currency and rate story sits an increasingly tense geopolitical map. Treasury’s move a few weeks ago to bail out Japan — notably by selling euros rather than dollars to support the yen — is being likened to a “Fort Sumter moment,” with the U.S. and China quietly lining up on opposite sides. It’s less the old “new world order” and more a kind of enlightened nationalism, with each country looking out for its own interest and gold playing a central role as the neutral reserve asset.
Layer on the still-unresolved conflict with Iran and the on-again, off-again talk of a peace deal, and you get exactly the kind of uncertainty that keeps a floor under gold. Oil tells the same story of nerves: crude round-tripped from about $68 up toward $120 and back again this year on Strait of Hormuz fears, a reminder of how much of the recent move has been speculation rather than fundamentals. One striking marker of the times — an ounce of silver is again approaching the value of a full barrel of oil, something that would have sounded absurd just a year ago.
Gold Breakout is Brewing
Technically, this week’s surge is encouraging without being conclusive. Gold has traced a tight compression, or “pennant,” pattern and pushed intraday slightly above its recent short-term highs, while silver — despite its 5% pop — is still sitting just below its comparable resistance. In other words, the setup looks like a genuine breakout attempt, but it hasn’t been confirmed yet.
The levels to watch: gold needs to close firmly above roughly $4,200 and silver above roughly $63 for several days to validate a true breakout, with overhead ceilings then waiting near $4,600 and $4,800. It would likely take $4,900–$5,000 gold to start arguing for a run at new all-time highs. Notably, the big banks are aligned with that bullish bias — Deutsche Bank and Goldman Sachs are targeting around $4,700 by year-end, and Wells Fargo is calling for $6,000. The practical playbook remains the same as it’s been all year: buy the dips (near $4,000 gold and $58 silver), and don’t chase the spikes.
Time to Rebalance Your Portfolio?
With the S&P at fresh all-time highs, this is the moment for a portfolio check-up. The hard truth about the investor mindset is that most people buy hedges at the top, when it’s exciting, rather than at a depressed value, when it actually works. A hedge only does its job if you acquire it when it’s cheap.
If you’re sitting at, say, 60–70% in equities and only 10–20% in metals after this equity run, it may be time to trim some stock profits and rebuild your metals hedge. Here’s the discipline to carry forward: buy the dips if you’re adding ounces, and reserve selling for genuine liquidity needs or the sharpest spikes. Most importantly, sit down and reassess your total portfolio percentages — add ounces, trim ounces, or shift into cash as needed.
Plan Your Next Move
Is your portfolio due for a rebalance, or are you looking to add ounces on the next dip? The team at McAlvany Precious Metals has a collective 75 years of experience investing in the precious metals market. We’re happy to speak with you about your goals on a no-obligation, complimentary consultation. Reach out to us at 800-525-9556.
