October 22, 2025 - In a dramatic turn for the precious metals market, both gold and silver recently experienced their steepest single-day declines in years, sparking widespread concern among investors. However, amidst the selloff, a counter-narrative has emerged from Saxo Bank's head of commodity strategy, Ole Hansen, who characterizes these metals as "under-owned." This sentiment suggests that despite the recent volatility, the fundamental drivers for a long-term bullish trend remain firmly in place, potentially setting the stage for renewed investor interest and significant future gains.
The immediate implication of Hansen's perspective is a potential "buy the dip" opportunity for investors who missed the earlier rally. The correction, rather than signaling the end of a bull market, is viewed by many as a healthy recalibration of overheated prices. This re-evaluation could reinforce gold and silver's structural support, especially as declining confidence in traditional financial systems, persistent central bank accumulation, and robust industrial demand continue to underpin their long-term value.
Dramatic Selloff Reshapes Precious Metals Landscape
The "dramatic selloff" that preceded Hansen's commentary saw gold plummet approximately 8% from its recent highs on October 21, 2025, marking its largest decline in over a decade. Silver experienced an even sharper plunge, falling more than 10%, its worst performance since February 2021. This rapid correction followed a weeks-long rally that had pushed both metals to unprecedented price levels, with gold breaching $4,000 per ounce for the first time on October 7 and silver hitting a multi-year high of $54.47 by mid-October.
Several factors converged to trigger this sharp downturn. Widespread technical profit-taking after a prolonged rally played a significant role, as many traders opted to lock in substantial gains. Low liquidity, particularly in the silver market, exacerbated the price drop as leveraged traders rushed to sell. Contributing further were a slowdown in physical demand from key Asian markets post-Diwali, renewed optimism surrounding U.S.-China trade discussions reducing safe-haven appeal, and a strengthening U.S. dollar making dollar-denominated assets more expensive for international buyers. Additionally, both metals were technically "overbought," signaling that a correction was due.
The immediate market reaction was one of caution, with gold consolidating around $4,067 to $4,236 per ounce and silver near $49-$53. However, the underlying sentiment from key players like Saxo Bank's Ole Hansen quickly shifted towards viewing the correction as a temporary "reset." This highlights a divergence in market perception, with some seeing risk while others, like Hansen, identify opportunity in assets they believe are fundamentally undervalued in current portfolios.
Companies Poised to Win or Lose in a Resurgent Precious Metals Market
The "under-owned" sentiment and potential for renewed investor interest in gold and silver will undoubtedly create significant winners and losers across various sectors, particularly within the mining industry and investment vehicles.
Gold and silver mining companies stand to be major beneficiaries. Companies like Newmont Corporation (NYSE: NEM) and Barrick Gold (NYSE: GOLD), as leading global gold producers, will see improved profitability and cash flows as metal prices rebound. Higher prices incentivize increased production, exploration, and make lower-grade deposits economically viable. Similarly, silver-focused miners such as First Majestic Silver (NYSE: AG) and Pan American Silver (NASDAQ: PAAS) are well-positioned to capitalize on rising silver prices, especially given the metal's robust industrial demand from green technologies. Americas Gold & Silver (NYSE: USAS) is also a pure-play option with a significant portion of its revenue tied to silver.
Exchange-Traded Funds (ETFs) also offer direct and indirect exposure. Physical gold and silver ETFs like SPDR Gold Shares (NYSEARCA: GLD) and iShares Silver Trust (NYSEARCA: SLV) directly track metal prices and will see increased inflows. Mining ETFs, such as VanEck Gold Miners ETF (NYSEARCA: GDX), provide amplified returns when precious metal prices rise due to the operational leverage of their underlying companies. Royalty and streaming companies like Wheaton Precious Metals (NYSE: WPM) and Franco-Nevada (NYSE: FNV) are particularly well-positioned, as they benefit from rising spot prices with reduced operational risks and costs, often outperforming physical metals and traditional miners on a risk-adjusted basis.
Conversely, some sectors may face headwinds. Jewelry companies, heavily reliant on consumer demand, could see sales volumes affected as rising gold and silver prices translate to higher input costs. Retailers like Signet Jewelers (NYSE: SIG), Pandora (CPH: PNDORA), and Tiffany & Co. (NYSE: TIF) may be forced to increase prices or adjust their product offerings, potentially impacting their stock performance. The dynamic nature of the precious metals market thus creates a clear delineation of potential winners and losers based on their direct or indirect exposure to the metals' price movements.
Wider Significance: A Structural Shift in Global Finance
The "under-owned" sentiment for gold and silver, particularly after a sharp selloff, carries a wider significance that extends beyond immediate market fluctuations. It reflects several profound industry trends and potential geopolitical shifts. At its core, it speaks to an ongoing re-evaluation of trust in traditional financial systems and a strategic pivot towards tangible assets.
This event fits into a broader trend of sustained safe-haven demand, fueled by persistent inflation concerns, macroeconomic uncertainties, and heightened geopolitical tensions. Gold's rally throughout 2025, despite its recent correction, underscores its enduring appeal as an inflation hedge. Crucially, central banks, especially from emerging economies, continue to aggressively accumulate gold, signaling a long-term strategic move away from U.S. dollar dominance. For silver, its dual role as a precious and industrial metal is paramount. Surging industrial demand from solar cells, electric vehicles (EVs), and advanced electronics is creating persistent supply deficits, making it a critical commodity for the green economy.
The ripple effects are evident across the investment landscape. While mining companies and precious metal ETFs are poised to benefit from renewed interest, the recent selloff highlighted a divergence: gold miner ETFs experienced outflows, suggesting investors preferred direct exposure to physical metal over higher-risk equities, whereas silver miner ETFs continued to attract inflows. This indicates differing risk appetites and perceptions. Regulatory bodies may also increase scrutiny of derivatives markets if volatility persists, potentially leading to new rules aimed at market stability. Furthermore, trade tariffs, particularly if they target critical minerals like silver, could significantly impact global supply chains and economic activity.
Historically, sharp corrections in precious metals often precede renewed upward momentum. The 2008 financial crisis saw gold initially decline but then rebound strongly, ending up over 25% during the stock market selloff. Similarly, the mid-1970s gold crash was followed by a massive reversal. These precedents suggest that while initial market shocks can lead to forced selling, investors often return to precious metals once the dust settles. However, with gold prices at unprecedented levels (above $4,000 per ounce), analysts note that "the game has changed," and increased volatility might be a "headwind for potential 'wealth preservation' flows," requiring a more nuanced approach from investors.
What Comes Next: Volatility and Long-Term Potential
The immediate future for gold and silver is likely to be characterized by continued volatility, but within a predominantly bullish long-term trend. Short-term possibilities (late 2025 - early 2026) suggest gold consolidating around $4,000-$4,100, with analysts projecting averages around $3,675 by Q4 2025 and potential climbs towards $4,000-$4,400 by year-end. Silver is anticipated to mirror gold's strength, potentially consolidating around $50-$55 per ounce. These movements will be heavily influenced by incoming economic data, central bank communications (especially regarding further interest rate cuts expected in late October 2025), and evolving geopolitical developments.
Looking further ahead (2026 - 2030 and beyond), the long-term outlook remains robustly bullish. Aggressive forecasts for gold range from $5,000 to $10,000 per ounce by 2030, with silver potentially exceeding $100 to $200 or higher by 2030-2035. Key drivers for this long-term appreciation include persistent inflation, continued currency weakness and de-dollarization efforts by central banks, falling real interest rates, and ongoing geopolitical instability. Silver, in particular, benefits from explosive industrial demand from green technologies, which is expected to create persistent supply deficits and drive significant price appreciation.
Strategic pivots for investors should include gradual accumulation during price dips, maintaining portfolio diversification with a recommended 10-15% allocation to precious metals, and a balanced approach between gold (for wealth preservation) and silver (for growth potential). Companies, especially miners, must focus on operational efficiency, cost management, and strategic exploration to capitalize on rising prices while navigating supply chain challenges. Market opportunities will stem from inflation hedging, safe-haven demand, and the green technology boom for silver, while challenges include short-term volatility, a potentially stronger U.S. dollar, and profit-taking after significant rallies.
Comprehensive Wrap-up: A Strategic Opportunity in a Volatile Market
The recent dramatic selloff in gold and silver, though unsettling for some, has solidified the sentiment from experts like Saxo Bank's Ole Hansen that these precious metals remain "under-owned" in global portfolios. This correction, following an unprecedented rally throughout 2025, is largely viewed as a "healthy reset" rather than an end to the long-term bull market. Key takeaways underscore the resilience of gold and silver as inflation hedges and safe havens, driven by persistent macroeconomic uncertainties, aggressive central bank accumulation, and robust industrial demand for silver.
Moving forward, the market is expected to stabilize, with a predominantly bullish long-term outlook. Gold and silver are poised for continued relevance, fueled by falling interest rates, ongoing geopolitical instability, and a structural shift towards tangible assets amidst concerns about currency debasement. The "under-owned" status implies significant room for both institutional and retail investors to increase their exposure, particularly as the underlying fundamental drivers for appreciation remain strong. This suggests that the recent dip could indeed represent a "once-in-a-decade opportunity" for strategic accumulation.
The lasting impact of this sentiment is likely a continued re-evaluation of precious metals as core components of diversified investment portfolios. Gold will maintain its role as a bedrock of stability and a hedge against inflation, while silver's growth potential, propelled by its critical role in green technologies, will attract growth-oriented investors.
Investors should closely monitor U.S. inflation data and Federal Reserve monetary policy, as continued rate cuts would significantly support precious metals. The evolving geopolitical landscape, U.S. dollar index movements, and central bank buying trends will also be crucial indicators. For silver, specific attention should be paid to industrial demand reports and supply chain dynamics. Watching key technical support levels for both metals will help identify potential rebound points. In a world of ongoing uncertainty, gold and silver, despite their recent volatility, appear set to shine as essential components of a resilient investment strategy.
This content is intended for informational purposes only and is not financial advice
