The Great Metals Crash of 2026: What 140 Years of Data Predicts Happens Next . This may surprise!

Ah, there you are. Hello, my name is Clive Thompson. Today is January 31st, 2026. It's Saturday. Yesterday was Friday, often known as Smackdown Friday, and what a smackdown

it was for precious metals. It was a day of historic proportions. We witnessed a bloodbath in the metals market. So today I'm going to be talking about that. I'm going to be telling you what caused it and why people might have got it wrong.

I'm going to tell you what comes next or at least what might come next based on historical precedent. So let's just go back a little bit and talk about what's been going on historically. After a spectacular year-long rally that saw gold and silver

smash record after record on Friday, Smackdown Friday as I sometimes call it, the bubble didn't just leak. It burst violently. Gold, silver, platinum, and palladium

all plummeted in a sell-off that has left investors breathless and asking themselves two questions. Why did this happen and what comes next? So, let's start by just looking at the chart of this bloodbath. So, I'm going

to bring the browser up and we'll have a look at that. So, let's go to gold to start off with. Here you see the huge collapse in gold. This is a daily chart going back to September last year. Uh you can see in September last year the price was 3,300

and something. It rose quite slowly to start with until it was past the $4,000 mark by about um dis early December and then it accelerated in December, crashing through the $5,000 mark without

even stopping. Went all the way up to nearly 5,600. Uh might have might have touched 5,600 with depending on which chart you're looking at. uh and then slipped a little bit and then we see on Thursday, but Friday, look at that drop.

Gold was down 8.99% ending up at $4,89359, a drop of 8.99%, call it a drop of 9% for simplicity. And the futures, the

nearated futures fell even further. They finished at about $150 below the spot price. Uh down $69 on the day or 11.39%. Silver fared even worse. Spot silver was

down an incredible 26.44%. I think I've got to repeat that. 26.44% 44% down in one day or $30 odd dollars $305 in a day. But the futures, the

nearated futures down $35.90. That's more than silver was worth 6 months ago. That was a drop of $31.37%. Nearly a third of its market value was

knocked off in one day. Platinum didn't fare any much better, down 17.2% or uh finishing at 2150 and palladium down 16.25 ending at 1682.

In Shanghai, the futures price dropped $21 or or 16%. But I think we can't look at any of these prices and regard them as real because these prices are going to bear no resemblance to what we see on

Monday. On Monday, we might see a fall further fall or we might see an extremely strong rally uh and the prices you're seeing in coin shops and the prices you're seeing uh in different countries and different places are all over the place. So take really you have

to take no notice of these prices other than to get the direction uh which has been down. So today we're going to look at what the impact of these falls could be on the

stock market, what they could do to Bitcoin and what history teaches us about what's going to come next. Now I've conducted a deep analysis this and I've started very very early this morning and it's now um 7:00 over 7:00 in after 7:00 in the evening in Europe.

Um so I've been doing this all day. Um, I've conducted a deep analysis of every major stock market crash going all the way back to 1885 to see what happens after a day like yesterday. And I've also looked at all the previous crashes

in gold and silver to see what might happen next. And I'm going to be telling you that shortly. The results might surprise you or they might not. But let's get into it. First, let's get a handle on the scale of this

collapse. As you can see on the chart looking at the gold price, the the rally was nothing short of parabolic. In 2025, gold surged 66%

and silver was up an incredible 135%. Then just before the crash, gold was flirting with $5,600 and silver had soared past $120

and then the floor gave way. Let's have a look at the damage which was done on Friday, January 30th, yesterday. So here we see the very very large drops

in prices of the futures. 31% go silver 11% gold platinum 18% and palladium down nine. And the spot prices were also down very very sharply.

Now moving on. This obviously wasn't a minor correction. It was a violent unwinding of one of the most crowded trades in the market. The ETFs that track these metals also

fell and felt the full force of the blow. The popular iShares silver trust at the symbol is SLV lost 31% of its value even more than the spot

price of silver. And again, don't take that as being representative of the net asset value. Um things were moving so fast it may be above or below the net asset value of

those shares at the moment. We'll find out on Monday as thing as as prices well we don't know prices are probably going to move very fast on Monday one way or the other. Um so I'm not going to say which direction other than I'll tell you what I think in a minute. Um but we'll

get to that. But another one which really really hurt was the ProShares Ultra Silver Fund that cratered by over 62%. So beware of leveraged funds. They can move far further and far faster than you

can imagine. It was one of the worst days on record for both. So what happened? Why did the market suddenly panic and sell all its gold and silver?

Well, President Trump announced his nomination of the next chair for the Federal Reserve. His name is Kevin Walsh. He was a former governor

and he has been seen as uh a sound money person because of the fact in 2011 he resigned from the Federal Reserve. Why? Because he didn't agree with the um

quantitive easing QE2 it was known as at the time and he felt that this would be inflationary. So you can see based on that a lot of people see him as a hard money man. But I think you're going to find out a lot

more this weekend and on Monday. Uh because looking at some of the things he's said since um my conclusion and I won't go into too many details here, but my conclusion is that he's a person who

tends to follow whoever is in power at the time. and he has made some statements um which you can read about if you Google it but they make me think that he's not at all going to be uh hawkish uh but rather could well be very

dovish and support lowering of interest rates something which even President Trump has said he expects that he will be lowering rates he Trump says he agrees with him that rates should go lower but that's not how the market saw it on

Friday because they didn't know that. They perhaps hadn't got time to read up on him. But I think you're going to find out that uh that that view that they employing somebody who is uh um going to defend the Federal Reserve as was seen back in 2011 uh defend the independence

of the Federal Reserve. Perhaps uh it's not all that it seemed at first sight. Um that's just my opinion. We'll see what the papers and um TV channels make of it over the weekend.

Anyway, his appointment had an immediate and powerful effect on the US dollar. Let's have a look at that now and see what happened to the dollar. So, I'm going to bring up the DXY. The DXY is an index of

a basket of currencies. Now last year the to just make that fit on the graph here. Auto fit. There we are. Last year the DXY that's the dollar index fell by about 10%. There we are from there to there on

that red line. And it started falling just last few days until yesterday when we heard about the appointment of Kevin Walsh and the dollar rallied about 1%.

Now a stronger dollar means it will cost foreigners more to buy gold. So it's a contributory factor perhaps in the in gold's fall. But of course what was really going on in the fall was as it started to plummet it triggered stop

losses. Stop losses are where someone has said I'll buy some gold but if it falls below a certain level I want this to be automatically sold. Do not consult me, just do it. That's a stop-loss. So, if it touches a certain price, the gold

is automatically sold at the next price. It doesn't mean to say you get the price of your stop loss. You get the next price after that stop loss, which could be 5 cents lower, it could be 10 cents lower, it could be dollar lower, it could be $5 lower. Um, I personally would never recommend anyone to put a

stop-loss, but uh the whole world is full of people who uh have leveraged bets. uh they they borrowed or betting 10 times as much money as they've got. Uh and they know they could lose it all, but to make sure they don't lose more than they've got, they have what's

called a stop-loss. So, if the price falls beyond a certain point, they're auto sold, ensuring that they maybe they don't have anything left, but they haven't lost more than they uh they had to start with. And of course, if you're on a contracts for difference uh site,

CFDs as they're called, um those sites often let you trade five, 10, sometimes many times more, even one or two up to 100 times as much as your net worth in the of money you've got on the site. So, of course, those sort of sites have very

tight stop- losses because they don't want to be going to collecting money from people on the other side of the world. um they'd much rather that the position that p a person's taken is sold before there's a problem of trying to get the cash. So

if you place a order on a contract for difference site to buy or sell gold or silver, there's an automatic stop-loss being put in place depending on how much money you've got in the account. And of course, futures traders also are like that. They trade on margin. they only

have to put up a certain amount of margin about 10%. And if the price starts falling against them, they immediately have to put up extra cash. And if they haven't got the extra cash, they have no choice but to sell into the market at any price. Uh and again, that

would be done by some sort of stop-loss if they haven't got their money. So, because of the incredibly huge rally, we'd had more and more people coming

into a crowded trade, uh, buying gold and silver. They were short-term traders. They'd come in, uh, they were putting stop losses to prevent them to avoid them losing more than they could afford to lose. And once one stop loss gets triggered, that pushes the price lower, which triggers the next stop

loss, which pushes the price lower, which triggers the next one, and so on and so forth. and to add fuel to the fire when this sort of thing starts to happen. There are some big boys who come in to effectively short the market because they know they know the price is going lower when they see they can see

they've got visibility on all these stop losses. They can oh there's one there, one there, one there, one there, one there. All we have to do is sell into the market. We'll trigger all these stop losses and we can buy back at a lower price. So these stop losses cause the market to cascade into like dominoes. one domino

knocks over the next one and it it goes it's a downward spiral. Uh but of course there are people profiting it from it because they know exactly where those stop losses sit and they can sell it at one price and expecting to buy back when all the stop losses are triggered and

they can buy back and make a profit. Uh so when you've got these upwards movements like uh what we have seen kind of a parabolic move you get more and more people putting in very very tight stop- losses like hair triggers and the

slightest decline can trigger them all to go off at the same time and that's what happened on Friday. So the shock wave from the metal markets was felt across other markets too. Stocks took a little bit of a hit. It wasn't much. The Dow Jones uh industrial average and the

S&P both fell by 0.4%. While the tech heavy NASDAQ index dropped by 0.9%. It wasn't very much at all. Uh but the hardest hit part of the market and this I know will be hurting many many people myself included um was

the mining shares sector. Now, it doesn't matter if you started buying mining shares 9 months or 12 months ago when I started talking about them because you're still well up. But if you bought them in the last month or so, u and particularly in the last month,

you'll be looking at a loss because those mining shares fell very very heavily. Um, one example, for example, was Kerr Mining. Um, that's a silver miner that's down 17% but many mining stocks were down much much more than that.

Bitcoin, sometimes called digital gold, didn't offer any safe haven either. Um, it's been in a down downward trend for some time since last October and its price was down another 2% towards

$81,000 on Friday. Um it's at currently at about $78,000 over the weekend on Saturday afternoon at late afternoon. So both old world and new world gold

bitcoin or gold physical gold both were falling. But what does this huge fall this crash tell us about what's going to happen next? Can we find out uh or can we have

a guide? Now, I have taken the time since first thing this morning. I've been up first thing this morning and I've been studying until now. It's now uh nearly 8:00 in the evening European time. Um I've studied every single crash, every single single day crash in

the Dow Jones Industrial Average since 1885. Now, that's 130 years of history and more than 38,000 data points. I also looked at every single crash in gold and silver. Uh

although on that I couldn't go back uh nearly as far as 1885 with the Dow Jones. But I'll get into the gold and silver shortly. Uh but let's just start by talking about uh the fact that my conclusion as to

what's going to happen is the same. Whether it be stocks or precious metals, they both tend to behave in the same way after a crash. So let's look at the stock market crashes. I started looking for a crash

of the same order of magnitude as the silver crash. And unfortunately I maybe it's fortunate, I don't know. I could only find one crash in the Dow Jones of over 15% which is kind of like the silver crash

of uh what did we see uh it was down 26%. So there was only one crash which was greater than that. Um and on that occasion in the Dow Jones that is the Dow rallied strongly immediately

after the crash. 7 days later it was up 6.2% 2% and a year later it was up at another all-time high of 31.21%. So within a year, not only did it fully recover the crash, but it went on to make another high. But that was just one

data point of a crash of that scale. So we can't really draw any conclusions. I then tried to look at crashes of 10% or more, but they also are incredibly rare. There were only four instances. So

again, and I I don't think we can draw a firm conclusion. So I broadened my criteria to look at the single day crashes of 5% or more. Now that's more like in line with what gold did. Um

gold, don't forget, uh we're over here it fell by 8.99%. A bit more on the futures market, 11% on the futures, but on the spot market it was down 9%. So, um, I was looking at all the stock market crashes at this

point of 5% or more, and most of them fell in the range of 5% to 10% in line with what gold did on Friday. And this gave me a much larger and more statistically significant sample size of

85 crashes since 1885. Yes, the stock market dropped by more than 5% in a single day. 85 times since 1885. And this is where I start to see a clear pattern.

Following a 5% or more single day crash, the stock market, the Dow Jones Industrial Average, was twice as likely to move up strongly than it was to continue falling.

Let's look at the numbers here. I'm going to bring the numbers up here. So, as you can see, looking at this, this tells us the time after the crash

of the Dow Jones by 5% or more. I'm looking at what happened 7 days after, 30 days after, 3 months after, 6 months after, and one year after. And as we can see, whoops, I've gone off

the page. Go back to the page. As we can see over every period there were more gains typically twice as many gain upsides as there were downside periods. Now that's two out of three

chance probability that the next move is going to be up as opposed to a one in three chance of down. But of course it's still rolling the dice. But we can see that on average if we go to the one-year

mark at the one-year mark there were 62 occasions where it had risen strongly and only 23 occasions one-third as many so where it had fallen and on the 62

occasions more than two out of three times the average rise a year later had been 38.22%. 22%. But that doesn't tell us with a certainty what's going to happen on

Monday. Uh but it does tell us where the probability tends to lie. At least we were looking at the stock market there. So this is not looking at the precious metals market, but it provides some sort of historical analog of what happens

after crashes. It shows that historically sharp and violent crashes have often represented a buying opportunity, certainly more often they were a buying opportunity than a signal

to run for the hills. In other words, did it make any sense to sell after a crash? Uh well the answer is no it didn't because the odds were in your favor that you'd have a strong rally pushing back to a much much higher level than the the point from which you fell

in probability. So panic selling tends to create oversold conditions which are often followed by very strong rebounds and I think that perhaps that this will

happen this time. Uh obviously they're going to look at this guy Kevin Walsh over the weekend and discover that perhaps he's not such a sound money person as the market initially thought and maybe he will be doing Mr. Trump's bidding and voting for lower interest

rates at the Federal Reserve. Um which of course will be fueling inflation to some extent uh and it will also fuel the stock market and the precious metals market. But what happens next after a brutal

crash like this? So I went obviously as I I I went I went to the stock market and I analyzed um six I looked at the went beyond the stock market. I looked at the gold and silver markets to see what happens to gold and

silver when we have crashes like this. Now, I couldn't go back as far as the 1800s, unfortunately, as I could with the stock market. In fact, I could only find the data going back to August 2000. Um, but that's still 26 years of data

nearly. Um, and it's 6,300 data points I could look at uh for gold and silver. And I identified every single day where

gold or silver crashed by 5% or more on the day. So typically that would be a move of 5 to 10% in line with what gold did on Friday down 8.99%. So I tacked every single movement where

there was a crash in one day of more than 5%. And then I tracked what happened to the precious metal gold or silver in the days and months which followed. And the results are quite fascinating, but actually there's a stark difference

between the two metals. So for gold, a single day crash of 5% or more is an incredibly rare event.

In the 25 years of data that I can look at, it only happened about 10 times. This tells us that gold is relatively speaking a far more stable asset than its volatile cousin silver.

Let's just have a quick look at how that did. So, I'm going to go over here and bring up the There we are. This is gold.

And I'm looking at what happened seven days after a 5% crash. 31 days after a 5% crash or one year after a 5% crash. The reason these figures don't all add up to nine is in one one occasion uh the difference was

actually 0%. Um but what we see is after one year there were three times as many or three times as much probability uh three out of four probability that the price would

rise. I've gone to the wrong sheet here. Go back to that. There we are. Now that's only six versus two. Uh so six rises or two falls. It's not a huge and statistically significant number, but it does tell us that it was historically

was more likely to rise after a 5% crash than fall. And on average, gold was up 13.99% one year later, more than recovering the fall. But of course, you had to be patient to get that.

So whilst the market after a crash in gold was more likely to go up than down, the rebounds were not as dramatic as one might expect. One year after the 5% crash,

gold on the when when it went up was up about 38%. But if we take into account the losses, it would have been on average up 9.34% if you take the loss years as well as the positive years. But silver is rather different.

Silver tells us a completely different story. A 5% or greater single day crash is not an anomaly. It's a regular feature of the market. Since 2000, the year 2000,

silver has experienced 96 crashes of 5% or more. So those who are in silver have had a stomach churning time over the years, of

which most of which they've forgotten, but on 96 occasions, they've seen 5% falls in silver or greater. And of course, yesterday was probably greater than any of those falls ever. Let's see how silver performed after

those 96 crashes. And I'll bring that up here where we were on it. Sorry. Yeah, there we were on it. So, uh, by

the way, these figures don't always add up to 96 because some of the, uh, returns after one year were zero. So, they're ne neither positive nor negative. Um, but we see that on after one year after a crash of 5% or more,

silver was up 56 times and it was down 32 times. And the average gain for the up moves was 38% obviously uh clearly exceeding the size of the fall. So silver definitely was a

much more volatile asset and generally recovered uh not always because there were um like two out of three one out of three chances that it would fall but two out of three times it recovered and recovered very very strongly.

So the pattern is clear. The longer you hold on after a silver crash or for that matter a gold crash or for that matter a stock market crash, the higher the probability of a positive return. And the longer you hold on, the

more powerful that return is likely to be. Let's put it another way. It's always a good move to buy after or not always. um it's more likely to be a good move to be a buyer after the crash because quite often the crash represents

a situation where the metal has been oversold. So one year later after a crash silver was up 64% of the time um with the average up move being 38% after the crash.

So while my analysis of the Dow Jones suggested a two chances out of three that it would rebound and one out of three that it would continue falling. When you look at silver it's you can see

that history strongly favors the bulls. Bulls are the ones who go long silver buy it. Now another question is is there a correlation between stock markets and

precious metals? Does a crash in precious metal mean that the stock market is going to crash next? Well, history I've checked the two compared the two history and uh of gold, silver and the stock market to see to what

extent one can forecast the other. And the answer is a fall or a crash in gold and silver does not necessarily foretell a fall in the stock market. There is a weak correlation, very weak.

On days when gold crashed 5% or more, the Dow Jones fell on 60% of those days, but it rose on 40% of those days. So not much difference. it was more very close to 50/50 and and

for silver even less correlation. Um it rose it fell 57% of the time and rose 43% of the time. So almost 50/50 as well. So we c I couldn't detect much correlation between the way stock markets behave on days when gold and

silver are crashing. They tend to go in the same direction but only it's only a slight tendency to move together and and in the same direction. So a stock a precious metals crash is not a reliable indicator of a stock market collapse.

However, yesterday, January the 30th, Friday, gold, silver, and the Dow all fell in unison, pointing to a broader riskoff day where investors kind of sold everything which wasn't nailed down. So what's the future

for the precious metals? Well, if we look at the analysts, they're pretty divided. Um, you know, the bull case and most of the fundamental reasons for owning precious metals haven't disappeared. Geopolitical uncertainty remains high.

Many countries are looking to diversify their reserves away from the US dollar. Before the crash, major banks were calling for gold to hit $6,000. Deutsche Bank, Sockgen, for example,

uh they were talking about 6,000 in 2026. Um and on silver, they they were forecasting higher prices, too. Um City Bank, for example, were forecasting that silver would get to $150. So,

I haven't yet seen what they've got to say about it, but I've seen a number of comments and I think the general comment is the correction we saw on Friday and we're calling a correction um was an understandable correction after such a

long bull market and all bull markets climb walls of worry and corrections are part of the the makeup of every bull market. So, will this bull bull market continue? And is this just a correction on the way or is it telling us that it's

all finished and it's never going to get back to those levels again? I'll let you answer the question. I think a lot depends on how everybody else sees Kevin Walsh's appointment to

the Fed over this weekend. Um, I think the markets will be the the analyst and the newspapers will be digging much deeper into uh his views and not focusing quite as much on what he said and did in 2011, but rather on his more

recent speeches or talks and the things he said and done. Um, I can't go into the details of all that, but it's public knowledge, but my personal opinion is that he's going to be uh towing the line of what President Trump wants and voting

for lower interest rates. But what is for sure is that over the coming weeks, we're going to get a lot of volatility before the market actually finds its new level, higher or lower.

But if history is a guide, the odds are in favor of a recovery, especially for the more volatile silver. Now, before I just finish this off, I'm

going to just uh and I have one more thing to show you before we finish. Um please do like and subscribe if you like this sort of video. Um I will be covering um major events in the markets in the future. Uh but just to show you

one last thing or one or two last things here which I think are quite interesting. Um this is the um calcul this is the result of the calculations I did. What we were looking at here were the impact of 5% falls, 10% falls, 15%

falls, 20% falls uh over 7 days, 30 days, 91 days, 182 days, and 365 days. The most interesting one was this one down uh this one here. 5% moves over 365 days because I've got a lot of

data points. Um, and I'll blow that bit up. That that there we are. I see that there were 84 uh down moves. This is the looking at the Dow Jones since the 1800s. Um which

were followed by uh over one year an average including down days and up days of 22% gains with the best gains being 138% and the worst falls after a 5% fall

being 48% down. But we had 62 up moves, 22 down moves. So very much in favor of up moves. And the average up move was 38%. But where it went down, the average down move was 23%.

That was what I wanted to show you there. And here's a little histogram uh to show you the up moves of the So the down moves are here. Um that there was no move of I I actually put a minus 100% move in there, which didn't happen. um just a mistake on my

chart but you can see very few down moves on the left hand side and then the long right hand side starting here are the size of the or the number of up moves. So we had some up moves after the stock market crash of over 100%. These

are the 100% plus moves there and we had plenty of moves greater than 50% and even more greater than 20% starting here. All these moves were greater than 20% after a 5% fall in the stock market. And this is the 0 to 10% moves. So up

moves on the stock market after a crash of 5% or more overwhelmingly um were many much many more of them than down moves. And just to put it a little bit another way, uh this is in number

terms. The green bit here are the good day or good days. Good years good year for it was 365 day move. The the green bits are the size of the good moves after a stock market fall of 5% and the

yellow or red sort of light red. Um it's more yellow uh are the bad moves. So looking down here the frequency almost nothing falling after the stock market and after the after a fall if you have a 5% fall not many days were or years were

negative after that but on the other hand if we had an up move sorry we had a 5% fall almost all of the moves more than half were uh I think it's 66% something like that were up strongly and where where it did go up strongly the

moves were quite powerful you know you can see 30% % 40% 50% 60% uh five there were five moves of 70% or uh to 80% one move of 80 to 90 and even two moves of greater than 130%.

So that's all I had to show you ladies and gentlemen like and subscribe uh if you appreciate the effort I put into this. It's been a lot of work. I've been working all day to bring you this and I will keep you posted hopefully on Monday. I want to bring you good news

for those who are bullish on gold and silver. Uh but I suspect that if you're a buyer, you're going to have to pay higher prices and if you're a seller, it's not going to bounce high enough for you to get your money back. But uh uh all I can say is good luck and whatever

you do, I this is not a time to be going down to the gold and silver shops to try and buy or sell because they will have widened their spreads massively because they don't know what's going to happen. Just as I don't know, this is not investment advice. I really don't know what's going to happen. So, the spreads

will have widened out to much larger bid and ask. And that means that you uh if you're buying, you'll probably pay much higher than the the spot price. If you're selling, you get much lower than the spot price. Give it time, and those spreads will narrow as things settle

down, but that might take more than a few weeks. Um, so if you do insist on buying, uh, I would buy very very small quantities to see how you feel. And if you insist on selling, I wouldn't, uh, rush and sell it all. Just I'd sell a little bit to see how you feel cuz both

buyers and sellers might end up being disappointed by anything they do. I'm personally sitting on my hands. I never had any plan to sell anyway. Um, and just because it's gone down doesn't change my mind. So, I'm sitting on my hands and I hope that most of you will be able to sit on your hands until

things settle down. My name is Clive Thompson. Thanks very much for tuning in and thank you very much for all the lovely comments on my recent videos. They were really appreciated and some of them actually moved my heart. You guys are wonderful. Bye-bye now.