The situation in the USD Index will likely determine the next steps in commodities, precious metals, and mining stocks.
In short, it seems that the USD Index might have just bottomed, or it might do so soon.
The all-important 2023 high that provides strong support is at about 107. This is the level that stopped the rally in late 2024 (at the first attempt, it was not breached, and when it was broken at the second attempt, the breakout was invalidated and triggered a correction), which means that it could easily stop the current correction. This is the likely outcome here, which in turn makes it likely for gold and miners to reverse their courses and start their decline shortly.
Interestingly, today’s intraday low based on the above chart is 107.28…
…And based on this chart, it’s 107.08.
Either way, the 2023 bottom was either reached or it’s about to be reached. This could trigger a rebound, and an invalidation of the breakdown below the 23.6% Fibonacci retracement. This would be a perfect confirmation that the next big upswing is about starting.
Also, I spoke more about the medium-term target for the USD Index and how long it could take before the USDX gets there in yesterday’s webinar (yes, recording is available and it includes also the discussion of the final bottoming prices of silver and gold and many other things).
Meanwhile, silver is moving to its declining resistance line once again, and there’s nothing uncommon about it. As I described it previously, broader short-term tops are relatively normal for the white precious metal:
Silver is up, but it’s not as high when it was when we took profits from the previous long positions. It is another breakout, though. Will it this one be invalidated as well? That appears likely to me.
Please note that silver often pauses after the top and before the slice. That’s how it topped in October 2024, and in July 2024. Consequently, seeing a third top here is rather normal.
A fourth top will also be normal.
And speaking of normal topping patterns, if the current rebound in copper seems troubling, please consider that it’s exactly how copper topped in the previous cases.
Sometimes the rebound is bigger (Nov. 2024), sometimes it’s smaller (May 2025), and sometimes it’s average (Sep./Oct. 2024), but it’s normal for it to take place.
Consequently, what we see now is not a reason to become bullish.
All in all, the short-term outlook for mining stocks appears bearish at this time, and it might be the same for gold as well. I wouldn’t necessarily short gold here, but the trading positions that we have open remain very much justified from the risk-to-reward point of view – the outlook for them is excellent, in my view.
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Thank you.
Przemyslaw K. Radomski, CFA
Founder, Editor-in-chief