(Kitco Commentary) - Nov 3, 2026
1. Analysts are struggling to explain the current weakness of gold currency against fiat. The weakness is significant, and perhaps the best explanation is simply that gold showed tremendous strength in 2024-2025...
2. And it is now consolidating these huge gains.
3. The mantra that gold will rally if oil and rates fall has worked sometimes, but not at others:
4. Note the May-June period on this chart; rates oozed lower and oil fell 30%, yet gold moved about $700 lower at the same time.
5. From there, rates and oil rallied… and gold surged back up to $4700.
6. More recently, rates have fallen aggressively, oil has surged, yet gold has also dipped.
7. In a nutshell, investors like to live in hope of better times ahead where traditional analysis is reliable, but my suggestion is to treat the gold market as a war. In this approach, gold bugs are best served by functioning less as investors… and more as warriors.
8. Key zones for battle are highlighted. The green arrows indicate relative amounts of fiat risk capital to commit at each zone, after a price sale into it.
9. Clearly, the current zone ($3941) is one to buy, but with only a modest commitment of capital. Stochastics is oversold, which makes a rally highly likely… but not guaranteed.
10. From a contrary opinion perspective, this is also the time to buy, but the danger is that if gold descends further (perhaps to the next battle zone at $3500), buyers could break down mentally, and instead of calmly buying there…
11. They find themselves selling at a loss.
12. Investors always need to take their real-world intestinal fortitude into account when determining the size of their buys.
13. What about silver? The good news is that investor weariness at a key buy zone for gold is a bullish sign… for silver bug warriors who are ready to buy!
14. For a long-term look at this truly majestic metal. Intra-week volatility is removed, and the key $48-$43 support zone is crystal clear.
15. One caveat for silver: Amateur investors who read about US government debt a bit and then charge into silver often don’t fare well. Silver is “leveraged to gold”, but that doesn’t mean every investor should buy it, let alone do so with size.
16. I firmly believe that silver bullion stock buyers should have an emotional affinity to this metal rather than just an urge to outperform gold in fiat terms.
17. The buy zone is from round number $50 down to about $43, and a move to $70 is likely from about here, but silver could trade down to $35-$28 if gold goes to $3500-$3200.
18. The bottom line: Silver bugs need to be more warrior than investor if they are going to face this kind of unpleasant surprise... surprise that must be endured to build solid wealth that is sustained.
19. The Nasdaq has been surging since the 2008-2009 lows. Unlike gold stocks that typically sport AISCs sub$2000, a lot of high-flying technology stocks are cash-negative cows due to their enormous debt-funded bets on AI.
20. The stock market is vulnerable; a major crash isn’t necessarily imminent, but it’s more likely to occur now than at any point since the bear market lows about 14 years ago.
21. In Europe, huge protests against stagflation are becoming commonplace, and many of them feature violent mobs smashing and looting city stores. It’s probably only a matter of time before similar “goon squads” begin roaming the streets and rioting in America:
22. The two current drivers of stagflation are government debt and oil prices, and neither look like they will experience a long-term drop, because there’s too much damage to global oil infrastructure and the mid-term elections likely seal the “US politics quagmire deal”.
23. Just as the latest dip in gold has baffled most pundits and destroyed most economic mantras, the relative strength of miners against gold on the latest dip is also a surprise… but a pleasant one.
24. As noted emphatically, the current price and time zone is one for buying gold, silver, and miners, but if metals market warriors want to be able to fight (buy) at gold $3500-$3200, if a dip into that zone “impossibly” occurs, the size of the buys done here need to be hallmarked with the utmost of care!
