David McAlvany
Gold & Silver: Turbulent Reversals & Ratio Opportunities
Source: McAlvany Weekly Commentary
McAlvany covers the gold/silver bull market thesis, six years of silver supply deficit, and central bank net buying. Discusses when to start swapping silver to gold using ratio trading. The McAlvany Weekly Commentary has run for 18 years — one of the longest-running precious metals podcasts.
Editorial Summary
Context: Recorded the week after gold hit ~$5,600 and dropped ~21% in two trading days, then rebounded ~16% off the low. Silver ran from ~$47 in November to ~$121 in three months before correcting ~25%.
Key Takeaways:
The bull market is intact. McAlvany characterizes the selloff as short-term profit taking in a long-term structural bull, not a trend reversal. Compares it to the 1987 stock crash — a violent interruption inside a multi-decade uptrend.
The correction was technically healthy. Gold and silver both found support at the 61.8% Fibonacci retracement and bounced off the 50-day moving average. What typically takes weeks of cooling happened in two trading days.
Silver is in its sixth consecutive year of supply deficit. More demand than new supply — this fundamental backdrop supports higher prices independent of speculation.
Central banks remain net buyers. Primary demand is institutional, not retail. McAlvany calls these "strong hands" that don't sell on short-term swings.
Wall Street's 60-40 is becoming 60-20-20. Morgan Stanley's Mike Wilson recommended in late 2025 that investors shift half their bond allocation into gold. McAlvany views this as the beginning of generalist investor migration into metals.
Gold-to-silver ratio hit the low 40s before the correction. At that level, investors should exchange 10–15% of silver for gold — silver is relatively overvalued.
Ratio trading compounds ounces without adding dollars. Volatility between gold and silver is the mechanism, not the risk. When silver is cheap relative to gold (high ratio), hold silver. When expensive (low ratio), swap to gold. Never go to cash.
Price framework: McAlvany expects gold to pass $8,000/oz this cycle, implying silver above $200/oz at a conservatively assumed 35:1 ratio.
This summary is editorial and educational. GoldSilverSelect does not provide financial advice or endorse any investment strategy. Always do your own research and consult a qualified financial advisor.