TheDailyGold: Gold & Silver: A Cyclical Surge Within a Secular Advance

Published: Thu, 02/05/26

Updated: Sun, 02/08/26

Good Morning!

Some argue Gold and Silver have already registered a cyclical peak like 1974 or even secular peak like 1980 or 2011.

Others are convinced we’re in a blow‑off move similar to 1979-1980.

The weight of the evidence instead points to an ongoing cyclical bull market nested inside a much larger secular advance that should extend well into the 2030s.

The best way to mitigate the risk of sector corrections is to buy the right companies and at reasonable prices.

To learn which juniors we like best and have 5x to 10x upside potential, subscribe to TheDailyGold Premium 👇👇👇

Subscribe to TheDailyGold Premium for Only $149

1) Gold vs. S&P 500

As you will see shortly, one indicator of cyclical and secular peaks is Gold making a vertical move against the stock market.

Gold has just broken out from a 12-year-long base against the stock market.

It has not gone vertical yet.

This breakout signals potential for an acceleration in the shift away from conventional stocks and into Gold.

It marks the beginning of a move, not the end phase.

2) Gold vs. S&P 500 Historical

In this chart, I label cyclical peaks with C and secular peaks with S.

Notice how a vertical move in the Gold/S&P 500 ratio consistently precedes cyclical tops.

Given the recent breakout from a 12-year-long base, that kind of vertical move could start once the current correction ends.

The ratio also makes one thing clear — we’re nowhere near a 1980 or 2011-style peak.

3) Gold vs. Monetary Base

Here we plot the Gold price and then the prices needed to back 40% and 100% of the monetary base.

This is calculated from the amount of US Gold Reserves, the Gold price and Monetary Base.

At the 1980 peak, the Gold price backed 139% of the US Monetary Base.

During the Great Depression, the Gold price backed over 100% of the US Monetary Base at multiple points.

Today, the Gold price backs only 21% of the Monetary Base.

At the cyclical peak of 1974, the Gold price backed 61% of the Monetary Base.

At the cyclical peak of 2008, the Gold price backed 30% of the Monetary Base.

Subscribe to TheDailyGold Premium for Only $149

4) Gold vs. 60/40 Portfolio

The Gold/S&P 500 ratio closed at 0.62.

At present, its trying to break-out from a 12-year-long base.

A breakout gives it a measured upside target of 1.

The history is quite instructive.

The secular peaks of the last 140 years tend to be around 5.

This is monthly data. The peaks in the Great Depression may have been closer to 5 and we know the 1980 peak was above 7.

If the S&P 500 is at the same level in 10 or 12 years, that's nearly $35,000/oz for Gold.

5) Gold Remains Structurally Underowned

This is why corrections have been brief and not so deep over the last 18 months.

Too many professionals and retail investors are under-allocated to Gold and precious metals.

As of a month ago, the implied allocation to Gold by ETFs was only 2%. Now it's barely above 2.5%.

It was 8% back at the last secular peak.

There remains tons of allocating that needs to be done.

Summary

Gold and Silver are still early in a secular bull market and their cyclical bull market has plenty more room to run.

Gold has just broken out vs the S&P 500 from a 12-year-long base. It is the big moves after these breakouts that precede peaks.

Gold also remains structurally under-owned, with ETF exposure around 2–3% versus 8% at the last secular peak.

Gold currently backs only about 21% of the monetary base, far below past peak levels at cyclical and secular tops.

Key ratios like the Gold/Silver ratio and Gold vs S&P 500 are nowhere near 1980 or 2011-style peaks.

They are also well below the cyclical peaks within past secular bull markets. Silver is also far from prior cyclical and secular peaks.

It has just broken out from a 45-year-long base and still trades extremely cheap relative to the S&P 500 and to Gold, implying significant upside as the cycle matures.