Gold: one more flush possible before the next run
Odds heavily favor a drop to $3,500, yet I stay very bullish on gold long term. An earlier call for a decline to $4,300, then $3,900, played out. The $3,900 level was a pivot low tied to the October 2025 lows, and gold bounced off it. A flat zone acts like a floor below current price. If $3,885-$3,900 breaks, $3,500 becomes much more likely, and I would buy there heavily. That break would mark a technical breakdown, not the end of the debt-driven bull case.
Triggers for the decline: a rising stock market and a return of risk-on buying. When money rotates into crypto or AI stocks, capital leaves gold. Gold's lower move recently is likely that risk-on play. Fed policy cuts both ways. If the economy weakens and a December hike looks like the last one, that could lift gold. If the Fed signals multiple hikes in 2027, that is a much worse near-term headwind. A weakening economy may limit how long the Fed can keep tightening, which is the contradiction.
I bought at $38.85 (the $3,885 area) through the GLD ETF and already sold it as a short-term swing trade. For long-term physical additions, gold has to come down to at least $3,500. I already own gold bought below $2,000, so I would rather hold that than add up here. A $10,000 price target does not make today's entry good; opportunity cost matters, not just upside.
For 2027, gold could return to all-time highs near $5,600 by late in the year. The main focus is the descending trend line from the all-time high. A break there starts the next grind higher, though I doubt it will be as euphoric as the move in late 2025 and early 2026, which I do not think was healthy. There is no political effort to control debt, so debt and money supply keep rising. A recession would bring Fed money printing. With US debt above $40 trillion, the only way out is to print, which pushes gold higher. The open question is timing: 2027, 2028, or 2030.
Silver: harder to call because of the industrial side
Last year, with silver above $100, I called a move back to $50 or a pierce of $50. When it fell below $50, I bought $100,000 in silver bars stored at an offsite vault as a first long-term buy. I would add more around $40, or in the $45-to-$40 range. Physical is a long-term hold because it is too hard to flip and rotate.
The technical case: silver's 1980 high was around $48 and its 2011 high around $49-$50. After a breakout, price tends to come back and retest that old resistance from the other side before the next move up. That retest happened. I am not saying the low is in, only that it is close enough to buy a long-term entry. If gold drops to $3,500, silver likely hits $40, maybe $35. Buying here means buying where people bought at the 1980 and 2011 peaks, but since then deficits, money printing, and debt make physical more attractive.
Silver is harder to forecast than gold because of its industrial use. It is both a store of value and an industrial metal, with a demand surge from AI data centers. In a recession, safe-haven demand and falling industrial demand pull against each other. Silver eventually goes above $120, but the timing depends on whether 2027 brings a recession and on what oil does. For 2027, I expect at least $75, a 50% move from here, but I am unsure it reaches $120 that year. Strong long-term fundamentals do not stop cyclical drawdowns.
Top conviction for 2027: precious metals and the miners
My highest conviction for 2027 is precious metals. Oil had a big pop but could not get back to $150 during the whole episode, which says something weak about future oil demand and how much production is running. Metals are very close to their lows. There could be one more flush in GDX, the miner ETF, but I plan to start accumulating. As debt keeps ballooning, people turn back to precious metals for upside, and miners are a strong place to capture that, since they amplify both rising metal prices and falling confidence.
How to position: scale in, do not go all-in
Be vigilant with research and avoid social media echo chambers. Social media tells you to panic at the lows, when you should buy, and to buy at peak greed, like when silver hit $120 and everyone called for $250. Use charts; charts breed logic because the levels are hard to dispute and carry no bias. After nearly 28 years of trading, I almost never hit the exact low or high. So I lean into positions: I bought some silver below $50, and if it drops another $5 to $10, I buy more. Dollar-cost average in near the bottom, then exit slowly in tranches near the top. That has worked far better than going all-in at one level, where emotions take over when the trade moves against you even slightly. There is always another trade; usually our emotions only tell us we missed one.
The Fed's bind
Odds strongly favor a December hike, but the Fed cannot hike much more without hurting the economy. The economy will crack, and it has already cracked for the bottom 80%. People in the stock market enjoyed the wealth, but the market is getting dicey as inflation turns sticky. CPI came in hotter than expected and PPI data is out too, so this is not a clean return to normal.
The Fed is in a tight bind. So many people are hurting from inflation that getting it down to a reasonable level has to be the priority. Otherwise the top 20% keeps doing well as the market rises while everyone else suffers. Raising rates will likely pull the stock market back further, but the Fed has to help the majority now being crushed by inflation. I think they raise in December. The economy is already weak underneath with major cracks, so I doubt they get another chance to hike in 2027. Whether they cut is a separate question; I could see them on pause even as the economy weakens, trying to bring inflation down to 2%. Kevin Warsh really wants inflation under control.
On inflation, I think they keep working to bring it down for the bottom 80%. Ignoring lower- and middle-income people to keep the stock market rising only widens the wealth gap. A rising market can hide an economy where ordinary households keep losing ground. Policymakers cannot forever favor asset prices over inflation's burden on most Americans, and even successful inflation control cannot undo losses savers have already taken.
