Gold, silver plunge as technical correction mirrors 1979 bull run — strategist sees buying opportunity ahead

Gold and silver prices are reeling from one of their sharpest corrections in recent months, validating forecasts by market strategist Gareth Soloway, who had warned that both metals were due for a pullback after an unsustainably steep rally.

In just two days, silver has tumbled 12% from recent highs, while gold slid nearly 5%, signaling the start of what Soloway calls a “healthy and overdue correction.” Despite the sharp decline, he maintains a bullish long-term stance, emphasizing that such retracements are a natural part of strong bull markets.

Correction written in charts

Soloway, Chief Market Strategist at InTheMoneyStocks, noted that his technical models had predicted the downturn in silver well before it occurred. “Silver is now down over 10% from its highs. I said just days ago it was due for a 15–20% correction—and we’re already halfway there,” he said in his latest analysis.

His charts show that silver, which had surged from around $50 to nearly $55 per ounce, is now retracing toward $43–44 per ounce, where he expects strong support. “I’ll start nibbling around $43,” he added, though he cautioned against going “all in,” emphasizing a strategy of scaling in gradually.

Silver’s current correction, he noted, closely resembles prior pullbacks after major rallies, particularly those seen during the 2008 financial crisis and the COVID-19 rebound, where steep advances were followed by swift but temporary drops.

Gold mirrors the 1979 pattern

The veteran chartist drew parallels between the current gold rally and the historic 1979 bull run, which saw nine consecutive weekly gains before a deep correction. “We’ve had nine straight up weeks on gold again—just like in 1979,” Soloway explained. “Back then, the metal corrected sharply after an almost vertical climb. What we’re seeing now is nearly identical on the charts.”

In his view, the pattern suggests a cooling phase rather than a trend reversal. While gold could slide further toward $3,500–3,600 per ounce, he does not foresee a crash on the scale of the 1979–1980 correction, when gold dropped over 70% from its highs.

“The difference this time is the macro environment,” Soloway said. “In 1979, Paul Volcker was raising interest rates to 15–17%. Today, the Federal Reserve is cutting rates, not hiking them. Debt-to-GDP was 32% then—it’s 130% now. The backdrop couldn’t be more different.”

Why this time is different

Soloway argued that structural factors—like falling interest rates, global debt expansion, and de-dollarisation—make a long-term gold crash unlikely. “Central banks are buying record amounts of gold, led by China and other emerging economies trying to reduce dollar dependence. That’s a massive tailwind,” he said.

He also pointed to the psychological element behind the correction, observing that retail investors had become excessively bullish. “In Australia and elsewhere, physical gold and silver supplies were sold out. That’s usually a warning sign—the market gets euphoric, and weak hands have to be flushed out before the next leg higher.”

GDX and miners also slide

The correction has spilled over into gold mining stocks, with the VanEck Gold Miners ETF (GDX) dropping nearly 10%, and shares of Newmont Mining testing key technical support zones. Soloway expects further downside before stabilization, identifying $59–60 on GDX and $68–75 on Newmont as potential accumulation zones for long-term investors.

Trading emotion, not hype

Reflecting on market psychology, Soloway emphasized that the same emotional forces—greed and fear—govern trading cycles today as they did a century ago. “Charts work because they map human emotion,” he said. “Greed in 1929 was the same as greed now. Fear hasn’t changed either. That’s why patterns repeat.”

Despite the current volatility, Soloway remains confident in the broader uptrend. “Gold and silver are pulling back, yes—but this is a setup, not a sell signal. Once the correction runs its course, both metals are likely to make new all-time highs within a year,” he concluded.