Podcast: Play in new window
Gold and silver investors just watched one of the wildest starts to a year in recent memory.
We’re at the beginning of a whole new era for physical gold. In this week’s Golden Rule Radio, we break down the recent price movements in gold and silver and explore the broader market dynamics driving these shifts. We take a closer look at what’s been impacting silver over the past few weeks, the volatility we’ve seen, and why the bigger-picture momentum remains intact. We also discuss how current economic conditions and market sentiment are shaping opportunities in the precious metals space.
Let’s take a look at where prices stand as of Wednesday, February 11:
The price of gold is up 4% since our recording last Wednesday, currently sitting at $5,086. It is inching its way back up to the top end of its trading range.
The price of silver is up 9.5% from our last recording, sitting at $84.30. And while it has taken a dramatic tumble from its recent all-time high, the price was only $30 one year ago.
Platinum is up 4.5%, sitting at $2,110 and showing a little bit of recovery.
Platinum is up about 2% at $1,713.
Looking over at the paper markets…
The S&P 500 is up about 0.5% from a week earlier. It had two moves up and down 3% intraweek.
The US Dollar Index is down 1%, currently sitting at 96.9 as of this recording.
Silver’s Engineered Crash vs. Real Demand
Silver just went from a parabolic surge to what feels like a “ball bouncing down the stairs,” with a massive drawdown driven less by organic selling and more by policy and margin mechanics.
From early November, silver ran from roughly the high $40s to just over $121 before China abruptly halted trading to “kill the speculators,” followed immediately by New York–open margin calls and yet another CME margin hike.
The technical result was a very deep 78.6% Fibonacci retracement from that November low to the January 29th high, with price slicing through the 20‑day and 50‑day moving averages and tagging the 100‑day in short order. The key takeaway is that this was a forced shakeout in a market that was running too hot, not a collapse in underlying demand for silver itself.
If you own physical silver outright, this kind of washout is painful on the screen but structurally bullish: it tends to clear out weak hands, reset positioning, and eventually create better entry points for long‑term buyers who care about ounces, not daily ticks.
China’s Backwardation vs. US Contango: why location matters
In China, silver inventories have collapsed from around 5,000 tons in the mid‑2020s to well under 200–300 tons today, taking stocks to multi‑decade lows. The result is classic backwardation: spot (immediate delivery) trades above futures, and buyers are paying an extra 9.5%–10% on top of the “official” price to get metal in hand.
But in the US, inventories are flush. Dealers report ample Silver Eagles, 90% junk bags, and bars, and the futures curve sits in contango, with futures above spot. That tells you two critical things:
- Tightness is real, but it is regional: China and other strategic buyers are scrambling for deliverable metal, while US retail shelves are still relatively well stocked.
- The three “markets” for silver—spot benchmarks, futures contracts, and actual deliverable product—can and do decouple under stress.
The current comfort in US inventory is a grace period, not a guarantee. If global supply tightens further or a small additional slice of US investors rushes into silver, that apparent abundance can turn into scarcity very quickly.
Gold’s Quiet Strength Remains the Anchor
While silver has been the drama queen, gold is behaving exactly how you want your core monetary asset to behave: steady, resilient, and structurally bid.
Gold is only about 9% off its recent high, having climbed from roughly $3,900 in November to around $5,086 before a modest correction to a 61.8% retracement and a quick bounce off the 50‑day moving average.
Positioning data backs this up. In the Commitment of Traders report, the two main investment categories—managed money and other reportables such as family offices and private investors—are still roughly 4‑to‑1 long gold, a strong vote of confidence from professional capital. Silver, by contrast, has seen speculative longs collapse from 10–12‑to‑1 long down to about 1.5‑to‑1 in managed money, confirming that the big washout has indeed flushed the hot money from that market.
For portfolio construction, you should treat gold as your foundation and silver as your torque. Gold preserves purchasing power across regime changes and monetary experiments; silver tactically adds volatility and creates opportunities for ratio trades that ultimately grow your gold stack over time.
The East–West Monetary Shift and the Coming “Digital Gold” Era
We are early in a generational transition in the global monetary order, and gold sits at the center of it. China and other BRICS‑aligned nations have spent the last decade deliberately diversifying away from the US dollar, building out gold depositories, and encouraging companies and sovereigns to use gold as high‑quality collateral in cross‑border trade. The goal is straightforward: challenge US dollar dominance by backing trade with a neutral asset that cannot be printed or sanctioned at will.
What’s emerging is an architecture where countries can warehouse metal in Chinese (or other) depositories and tokenize it into a form of “crypto‑like” settlement: you don’t sell your gold, you pledge it and transact against it in a digital system. In effect, this is an attempt to reinvent a gold settlement layer on top of a digital payments stack—a cycle the West has run before: gold, to paper claims on gold, to pure fiat, and now likely back toward some version of digitized gold backing.
For US‑based investors, this shift has two major implications:
- Gold is increasingly the neutral reserve asset of choice in a fragmented, distrustful world; that supports a structural bid under the price regardless of short‑term Fed or CPI headlines.
- Your decision to hold physical metal today is not just about domestic inflation or Fed policy; it is about aligning your savings with the asset that adversarial states themselves choose when trust breaks down.
In that environment, owning liquid, easily verifiable physical gold in a mix of personal custody and vaulted/IRA structures is a way of putting your balance sheet on the same side of the trade as central banks, not just as local speculators.
Claim Your Complimentary Consult
Not sure what your next move should be in precious metals? The team at McAlvany is happy to discuss your personal situation and develop a strategy based on your goals. Our team has a collective 75 years experience investing in the precious metals market. We are happy to speak with you about your goals on a no-obligation, complimentary consultation. Reach out to us at 800-525-9556.
