Good Morning!

After the second greatest breakout in its history in March 2024, Gold has entered its first meaningful correction.

As we told subscribers in late January, this would be an intermediate term correction.

In long-term bull markets corrections are not only normal—they are essential.

History suggests that the current correction in gold may simply be the market catching its breath and correcting an extreme overbought condition before the next major advance.

Let's break it down....

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1) Gold Big Picture

Gold is in its first intermediate-term correction since the major breakout 24 months ago. 

The breakouts of 2024 and 1973 each led to Gold’s strongest two-year runs. 

In 1973, Gold (on today’s scale) peaked near ~$6000 before a 28% correction. 

Today’s drop has been ~27%, but it likely needs more time to complete. 

Based on the average of historic analogs including 2005, the #3 breakout, Gold still points toward ~$7000 in 2027.

2) Gold Post "Major Breakout" Corrections

Charting the “post-major breakout” corrections in Gold: 1973 (-28%) and 2006 (-25%), each lasting about five months. 

The current correction finished its first leg down, bottoming exactly when 1973 did, and just days after the historical average. 

After the rebound, expect a sideways-to-lower drift for roughly another 2+ months.

3) Test of 200-Day Moving Average

Gold breakouts follow a familiar rhythm: breakout → surge → correction → bottom around the 200-DMA. 

The vertical lines mark each post-breakout test of the 200-DMA. 

Gold futures (not shown) briefly touched that level intraday, while spot Gold (chart below) came very close—daily closes don’t capture the full picture. 

With the 200-DMA rising and spot Gold likely to trend sideways to down through spring, it looks poised to test that level.

It is important to note that Gold actually fell below the 200-DMA for a few weeks before making its final bottom in 1973 and 2006.

4) Macro-Market Picture

Investors should focus on researching companies—not fixating on macro noise. 

Quick macro for Gold: surging Oil → rising bond yields → higher inflation expectations → tighter Fed policy (for now). 

When the worry shifts from inflation to recession, that’s when Gold and the precious metals sector start their next leg higher.

5) Silver

Silver, after a blow-off top, most similar to 1974 or 2006, is lagging Gold again. 

The Gold/Silver ratio is consolidating bullishly and has a measured upside target of 77. 

Silver has a floor at $55. The 200-DMA is at $58 and rising. 

My guess, subject to change, is Silver does not outperform Gold until Gold takes out $5200-$5400.

6) Allocation to Gold Remains Very Low

Yet another chart underscoring the persistent under-allocation to Gold. 

Comparisons to 2011, 1980, or 1979 don’t hold up as money flows and allocations in recent years tell a completely different story.

Gold's share of ETF assets is barely above 2.0%. 

Look where it was in 2008 and 2011. 

From @Callum_Thomas

Summary

Gold remains in an intermediate-term correction—normal, healthy, and fully expected. 

Historical patterns suggest 2–3 more months before it completes. This pause only deepens the ongoing under-allocation to Gold. 

A ~$7000 target for 2027 remains reasonable. 

Silver should lag until Gold nears new highs, but likely holds a solid floor around $55–$60.

In TheDailyGold Premium....

In the last 2 premium updates, TDG #980 and TDG #981 we updated our upside potential analysis for 15 companies.

We assessed potential on a strict 2-year timeline. 

In TDG #980 we covered the upside for our Top10 companies. We wrote 200-300 words for each company. 

In TDG #981 we covered the upside for our next 5 companies. We wrote 300-400 words for each company.

We always factor in some cost inflation. In addition, we assumed a 100% increase in diesel costs.

We assessed potential at current metals prices and margins but also factored in the scenario in which Gold breaks above $5500 and reaches $7000. That breakout in Gold would pull Silver back to $100 and we factored that scenario in for silver companies. 

Value is out there. We do the work to find it. 

We will continue to uncover quality juniors trading at excellent values and sporting 5x potential over the next few years. 

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Thank you for reading.

I wish you all the best in 2026 and beyond.