Podcast: Play in new window
Precious metals take a modest decline this week with gold dropping 1% and silver down 7%. Despite the drops this week, February still wraps up with an overall strong metals market. The overarching trend continues to point towards strong bullish momentum as metals take a moment to digest gains from January.
Let’s take a look at where precious metals prices stand as of Wednesday, March 4:
The price of gold is down 1% over the past week, currently sitting at $5,135.
The price of silver is down about 7%, currently sitting at $83.30.
Platinum is down 6%, currently sitting at $2,147. While it’s still holding above $2,000, it did have another down week this week and kind of flattening out just like silver has.
Palladium is down 8%, currently sitting at $1,654.
Taking a quick look at the paper markets…
The S&P 500 Index is down 1%, sitting at 6,870, and continuing to show a little bit of rollover momentum.
And finally, the US dollar index is up 1.25% from our recording last week, currently sitting at 98.80.
A “Good Year” in Two Months
Despite a soft final week of February, both gold and silver logged their highest monthly closes on record, with platinum and palladium also firmly positive for the month.
- February performance: gold +6.9%, silver +9.4%, platinum +10%, palladium +3.2%.
- Year‑to‑date (through Feb 27): gold +21.6%, silver north of 30%, platinum +16.4%, palladium +10.4%.
In other words, what would be a respectable full‑year return for many asset classes has already been posted in the first two months of 2026. Options and futures data confirm that prices are consolidating near record levels while volatility remains elevated, which is exactly what you’d expect after a parabolic move.
Iran Conflict Spike Fades Fast
The Iran conflict gave us a textbook “safe‑haven spike and reversal.” Over the weekend following the latest U.S.–Israel strikes and Iranian response, gold jumped roughly 3.2% and silver about 7%, only to give back all of those gains and more within 24–48 hours.
- From that weekend peak, gold fell about 7.3%, ending 4.5% below its pre‑event Friday close.
- Silver briefly tagged the mid‑$90s, then plunged 19% from the high and sat about 13% below the pre‑event close by Tuesday.
This is consistent with long‑term history: geopolitical shocks (Iran, Gulf Wars, Middle East crises) often trigger sharp, short bursts of safe‑haven demand in gold and silver that fade once markets begin to price in outcomes rather than headlines.
The Real Drivers: Rates, Inflation, Money, and the Dollar
It’s important to note that a 61.8% Fibonacci correction in a strong uptrend is normal noise; what matters is what’s happening underneath.
Interest rates
Gold’s best environments are when rates are falling or expected to fall in real terms. Markets are now pricing multiple Fed cuts this year, and real yields have already come off their highs.
Inflation
Producer Price Index (PPI) was up 0.5% in January and about 2.9% year‑over‑year, with both PPI and CPI turning higher, hinting at a re‑acceleration risk rather than a clean “mission accomplished” on inflation. Historically, gold has responded positively when inflation data re‑heat after a lull.
Debt and deficits
U.S. fiscal policy continues to lean on larger deficits and expanding debt, eroding confidence in fiat and supporting long‑term demand for non‑debt monetary assets like physical metals.
Dollar trend
The Dollar Index (DXY) enjoyed a reactionary bounce toward 98–100 on war and risk aversion, but the broader pattern since early 2025 remains a stair‑step decline, not a new structural bull market. Short bursts of dollar strength can pressure metals intraday, but they are occurring within a longer trend that’s been friendly to gold and silver.
Gold’s “Kick to the Shins” Looks Like a Bullish Pause
Technically, gold has already retraced down to a 61.8% Fibonacci level off the explosive November–January rally (roughly $3,900 to $5,600), essentially “resetting” speculative excess without breaking its larger uptrend.
The market has been stair‑stepping higher in a rising channel, with the 38.2% retracement zone around $4,950–$4,960 acting as a mid‑range magnet. Recent selling pressure—driven by Chinese exchange interventions and higher CME margins—pushed prices toward the lower boundary of that channel in the low $5,100s.
From a risk‑management perspective, we see a “line in the sand” somewhere in the mid‑$4,500s to high‑$4,600s as a sensible medium‑term support band—roughly 10% below current levels.
Gold–Silver Ratio Opportunity
Silver continues to play its familiar role as gold’s more volatile cousin. After a more than 50% crash from the January blow‑off top to the early‑February low, silver has already rallied about 38% off that trough and finished February up 9.4%.
Today, with the ratio around 60, we remain heavier in gold than silver — and we’re cautioning against over‑correcting into silver here on the assumption that we’re guaranteed to see another 2011‑style 30:1.
Get In Touch.
What’s your next best move in precious metals investing? The team at McAlvany Precious Metals 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.
