Overbought

In recent weeks, several technical indicators have signalled that the seemingly unstoppable uptrend in gold and silver required a pause. For instance, as the following chart shows, last week the weekly RSI (Relative Strength Index) for silver reached 86, one of the highest values ever recorded. Even during the previous major bull market in precious metals (2000–2011), such a high RSI level was followed by a noticeable correction in both silver and gold prices.

We have no certainty as to how long this correction might last—whether a week, a month, or a year. Between April 2024 and April 2025, the uranium price and the stock prices of uranium miners corrected meaningfully without any change to fundamentals. Then, in April of this year, the bull market in uranium resumed. 

Since 2022, central banks worldwide have significantly increased their net gold buying in response to the freezing of Russian assets, growing geopolitical uncertainties, and increasing budget difficulties in major Western countries. This buying has been the primary pillar of the renewed bull market in gold, and the trend continues unabated, with net gold purchases amounting to 410 tonnes over the first six months of 2025—the second-highest figure since 2022. Fundamentals for gold and silver remain unchanged, and the current correction is bringing sentiment and technical indicators back to neutral levels. 

Brought by Boris Cukon, Fund manager “Isatis Investment Global Natural Resources Flexible Fund”