silver

A Strong Start!

Posted on by George Mahfouz

The stock market had a strong start to the year; however, the back half of the month was more volatile and capped the monthly gains. Out of the major averages, the small-cap Russell 2000 (see chart here) was the clear winner gaining over 5% in January. The Dow Jones Industrial Average (see chart here) advanced 1% while the S&P 500 (see chart here) eked out a 1/2 percent gain, however, the Nasdaq Composite (see chart here) closed the month with a slight loss.

I am not sure what to make of the markets here in 2026. From gold and silver going parabolic then subsequently crashing (click here) to Bitcoin losing over 30% from its all-time high, to the bond market trying to find its footing! It’s no wonder volatility began to spike as January ended. Pundits are pointing to the geo-political risks that are seemingly hitting the headlines daily, to our own country’s divisions that are increasing on the daily, to the Federal Reserve standing pat on interest rates and now ushering in a new Fed Chairman. How in the world can any analyst have the proper visibility as to where the markets are headed this year.

One way to shuffle through all the noise is corporate earnings. We are in Q4 earnings reporting season and so far, we are seeing broad strength in company earnings. Of the S&P 500 companies that have already reported their Q4 results, we are seeing double digit year over year growth which is a metric that investors can rely on. What I am cautious about in the short-term is the unpredictability of foreign and domestic policies. From one day to the next you never know what is going to come out. However, what impresses me is the absolute resiliency of the stock market. Recently have witnessed an invasion, threats of war, increasing domestic infighting, the Federal Reserve forthcoming changing of the guard and yet the markets remain near all-time highs!

Let’s hope soon that the political and economic backdrop comes together sooner rather than later so we can have more clarity as to how the rest of the year for the stock market will turnout.

Good luck to all 🙂

~George

Gold & Silver Stole The Show!

Posted on by George Mahfouz

Despite the overall markets booking impressive gains in 2025, it was gold and silver that stole the show. Gold (see chart here) went up and eye-popping 65% last year, while silver (see chart here) booked an unbelievable 135% return in 2025. That’s right, 65% and 135% annual returns on these precious metals (click here) which also set all-time highs. This type of parabolic move in gold and silver has not been seen in decades.

The overall markets also posted double digit gains with the Dow Jones Industrial Average (see chart here) gaining over 13% on the year, the S&P 500 (see chart here) booked a 16% plus gain, the Nasdaq Composite (see chart here) gained 20% and the small-cap Russell 2000 (see chart here) closed the year up 12%.

Needless the say the bulls were very happy with how the markets fared last year. As we head into the new year, I am looking for a similar backdrop at least at it pertains to the overall markets. In December, not only did the Federal Reserve cut interest rates they moved from quantitative tightening (QT) to quantitative easing (QE). This move essentially is going to flood the system with liquidity and capital flow that will move into the markets over the course of time. I know we are near or at record highs but there is an old saying on Wall Street and that is “don’t fight the Fed”. Meaning, when the Federal Reserve begins to implement accommodative policies such as moving from “QT” to “QE” markets typically respond favorably.

Make no mistake there are still risks out there from the geo-political backdrop to the instability out of Washington D.C. Without question when this volatility comes in and it will, the markets will act accordingly. So as much as this bull market can still run, I expect dramatic selloffs along the way.

Wishing everyone a safe and most prosperous New Year 🙂

~George

Gold gets pummeled!

Posted on by George Mahfouz

The price of gold fell below $1,400 an ounce for the first time in over two years. In fact, gold and silver both have lost over 10% of its value in the past two trading sessions. Panic selling has set in with not only key technical support levels being shattered, but fears that Cypress and other European countries may have to sell their gold reserves in order to generate liquidity. In addition, slower than expected Q1 growth out of China also added to the panic selling. This capitulation type selling has spilled over to the majority of the gold miners with the gold miners ETF (Symbol: GDX) chart losing over 20% of its value over the past couple of trading sessions. Folks this type of panic selling is what can happen once technicals and fundamentals breakdown and fear takes over. In looking at the most popular ETF that tracks the price of gold (Symbol: GLD) chart, it appears that a multi-year support zone could be found in the $128.00 area which is now only a few dollars away. However, when you have panic selling, margin call selling, institutional and hedge fund selling, all bets are off pertaining to technicals until the smoke clears and cooler heads prevail.

As far as the equities markets are concerned, this is a big week for Q1 earnings reports. We will hear from the likes of Coca-Cola (NYSE: KO), Goldman Sachs (NYSE: GS), Johnson & Johnson (NYSE: JNJ), Intel (NasdaqGS: INTC) Yahoo (NasdaqGS: YHOO), Bank of America (NYSE: BAC), American Express (NYSE: AXP) and Ebay (NasdaqGS: EBAY) just to name a few.

Good luck to all and have a great week 🙂

~George