Selloff Shock: Record Highs Give Way to Heavy Liquidation (week ending 2.6.26)

The gold futures selloff gathered momentum late last week as record highs in gold and silver gave way to aggressive profit-taking, triggering broader turbulence across financial markets. A firmer U.S. dollar, fading safe-haven demand, and a pullback in tech and equities reinforced a risk-off shift, leaving precious metals sharply off their peaks as volatility surged into the close. With traders now bracing for a one-two punch from the U.S. jobs report and fresh CPI data, bond yields—and by extension stocks and gold—are poised for sharp moves as rate-cut expectations reset.

Monday (2.02.26): Gold and silver started the week on the back foot, hovering near the middle of wide trading ranges after tumbling to four-week lows overnight, with April gold slipping about $40 to $4,707 and March silver easing to around $77.90 as a stronger dollar, rebounding U.S. stocks, and sharply weaker oil prices pulled money away from safe havens. The selloff follows last week’s record highs and fresh margin hikes from CME, which forced leveraged traders to post more collateral just as President Trump’s nomination of hawkish Fed pick Kevin Warsh boosted the dollar, while reports out of China point to heavy losses among leveraged metals traders after a key counterparty reportedly vanished, adding to the unwind pressure that’s still rippling through the market.

Tuesday (2.03.26): Gold and silver ripped higher in Tuesday’s U.S. session as traders piled back in after last week’s selloff, with bargain hunters pushing April gold up more than $300 to around $4,959 and March silver jumping over $11 to $88, helped by a softer dollar, firmer oil prices, and slightly weaker risk appetite across markets. Meanwhile, economic data drama added to the mix, as the January jobs report and several labor releases were postponed due to the partial government shutdown — though Washington moved to reopen the government, meaning those delayed reports should soon return to the market radar and could become the next big volatility trigger for metals traders.

Wednesday (2.04.26): Gold and silver tried to rally overnight, but traders hit the sell button by midday Wednesday, trimming those gains as short-term futures players locked in profits and a rebounding U.S. dollar pressured metals prices; April gold still managed to hang onto a modest $14 gain near $4,947 while March silver held stronger, up about $3 to $86.57. Adding to the wobble, Bloomberg reports China’s biggest gold ETFs just saw their largest one-day outflows ever — nearly $1 billion — as investors pulled money after gold’s sharp drop from record highs, suggesting some fast money is stepping aside even as the longer-term metals story stays very much in play.

Thursday (2.05.26): Metals hit a speed bump Thursday: silver led the selloff with a sharp midday drop—dragging gold lower too—as bargain hunters who jumped in earlier this week bailed out fast, triggering heavy liquidation in futures markets. A rebounding U.S. dollar, upbeat economic data, and falling oil prices added pressure, while silver’s wild ride included an overnight plunge of up to 17% after recently flirting with record highs. Gold slid in choppy trade, copper followed metals lower, and oil eased as U.S.–Iran talks reduced near-term supply fears—leaving precious metals looking overheated after a rally that may have run too far, too fast.

Friday (2.06.26): Gold caught a small bid Friday morning, with April gold last trading up $11.20 at $4,900.90, but silver stayed under pressure, sliding to a seven-week low as March silver fell $3.22 to $73.47 while futures traders continued dumping long positions. A stronger U.S. dollar over the past couple of weeks and a rebound in stock markets have siphoned some safe-haven demand away from metals, keeping rallies in check. Meanwhile, geopolitical risk stayed in focus as the U.S. and Iran kicked off talks in Oman aimed at cooling tensions that had markets worried about possible conflict—leaving traders balancing easing war fears against still-fragile sentiment in precious metals.

—--- 

JPMorgan–Pentagon silver push seen as strategic shift in U.S. critical minerals security

The big picture
JPMorgan Chase’s reported partnership with the U.S. Department of Defense to finance domestic silver processing capacity is being viewed as a strategic effort to secure critical mineral supply chains as national security and industrial resilience concerns grow.

Driving the news
The initiative centers on financing and expanding U.S.-based smelting capacity while the Pentagon takes a stake in infrastructure aimed at strengthening domestic access to precious metals needed for defense and energy technologies.

By the numbers
• 169–750 million ounces — estimated size of JPMorgan’s reported physical silver holdings
• $920 million — fine paid in 2020 tied to prior market manipulation cases involving precious metals trading
• $1.5 trillion — broader JPMorgan investment commitment across defense, energy, and other critical industries

Why it matters
The reported shift from derivatives trading dominance toward controlling physical supply reflects growing concern over securing materials vital to defense production, suggesting silver and other critical minerals are increasingly viewed as strategic assets rather than purely financial commodities.

What to watch
• Expansion of U.S. precious-metal smelting and refining capacity
• Additional defense-sector partnerships with private financial institutions
• Further strategic stockpiling of critical minerals
• Potential ripple effects on global silver supply and pricing dynamics

The bottom line
JPMorgan’s reported move to build physical silver reserves while partnering with the Pentagon signals a broader push to secure domestic critical mineral supply chains, highlighting how resource security is becoming central to both national defense planning and commodity market strategy.

 

—-- 

Bundesbank gold stance seen as warning sign for global monetary stability

The big picture
Germany’s Bundesbank holding massive gold reserves is being interpreted by some analysts as a signal that governments increasingly see precious metals as protection against mounting sovereign debt risks and potential monetary turbulence.

Driving the news
Growing sovereign debt burdens, bond-market stress, and geopolitical fragmentation have pushed central banks — especially across Europe and emerging markets — to expand gold holdings while debates intensify over whether reserves held abroad should be repatriated as monetary risks rise.

By the numbers
• 3,350 tons — gold held by Germany’s Bundesbank, second largest globally
• ~80% — share of Bundesbank balance sheet now represented by gold
• 2,452 tons — gold reserves held by Italy, third largest globally
• 2,300 tons — official gold reserves reported by China, with estimates potentially much higher

Why it matters
As sovereign debt climbs and bond markets wobble, gold is increasingly treated by central banks as a trust anchor and balance-sheet stabilizer, raising questions about long-term confidence in fiat monetary systems.

What to watch
• Moves by European nations to repatriate or nationalize gold reserves
• Gold accumulation trends among BRICS and emerging economies
• Policy debates within the ECB over reserve centralization
• Potential taxation or regulation affecting private gold ownership

The bottom line
Rising central-bank gold accumulation and reserve repositioning signal growing concern over future monetary stability, suggesting precious metals may remain central to both government strategy and investor risk protection if debt and currency pressures intensify.

—-- 

Private hiring slows sharply as January job gains miss expectations

The big picture
Private-sector hiring nearly stalled in January, signaling continued cooling in the labor market even as wage growth remains relatively steady.

Driving the news
ADP reported only 22,000 new private-sector jobs last month — far below expectations — while prior hiring figures were revised lower, reinforcing the trend of slowing job creation.

By the numbers
• 22,000 — private-sector jobs added in January
• 48,000 — jobs economists had expected
• 398,000 — total private jobs added in 2025 vs. 771,000 in 2024
• 4.5% — annual pay growth for workers staying in their jobs

Why it matters
Slower hiring points to cooling labor demand, but steady wage gains complicate the outlook, leaving policymakers weighing slower employment growth against still-firm pay pressures.

What to watch
• Upcoming official U.S. payrolls data for confirmation of hiring trends
• Whether wage growth begins to cool meaningfully
• Sector-level weakness spreading beyond professional services and manufacturing
• Fed policy reactions to slowing employment growth

The bottom line
Hiring momentum continues to weaken, but resilient wage growth means the labor market slowdown remains gradual rather than abrupt, keeping economic and policy outlooks uncertain moving into 2026.

—--

Paper gold cracks as Giustra warns monetary reset risk is rising

The big picture
Gold’s recent plunge wasn’t just a correction, according to mining investor Frank Giustra — it exposed stress in the leveraged paper gold system as global markets shift toward physical supply control and a more fragmented economic order.

Driving the news
A rapid 20% gold drop and steep silver sell-off followed margin hikes and thin liquidity, which Giustra calls a coordinated “liquidity event,” while the White House’s new Project Vault signals governments are moving aggressively to secure strategic resources amid rising geopolitical and currency tensions.

By the numbers
• 20% — gold’s rapid decline during the flash sell-off
• $12B — size of U.S. Project Vault critical-minerals initiative
• ~$1T — annual U.S. interest payments now pressuring fiscal stability
• 1953 — last official Fort Knox audit, fueling reserve transparency questions

Why it matters
Giustra argues markets are moving away from paper pricing power toward physical metal control, meaning future crises could favor holders of physical bullion over paper instruments while currency systems face rising reset risks.

What to watch
• Physical gold demand and Asian exchange pricing influence
• Expansion of state-backed supply-chain and mineral reserves
• U.S. debt trajectory and dollar stability signals
• Potential volatility across leveraged crypto markets

The bottom line
Giustra’s message: the current sell-off may be turbulence before a bigger shift, where currency debasement fears, physical metal demand, and geopolitical fragmentation keep long-term pressure tilted in gold’s favor while risk assets face a tougher environment.

—-- 

Trump embraces weaker dollar as BRICS accelerates push away from U.S. currency

The big picture
The U.S. dollar is sliding as President Trump signals comfort with a weaker currency to support American industry, even as BRICS nations step up efforts to reduce reliance on the dollar in global trade and reserves.

Driving the news
The dollar has fallen nearly 10% in 2025 and continued slipping into 2026 as rate cuts, tariff uncertainty, and tensions with the Federal Reserve weigh on sentiment, while BRICS countries expand alternative payment systems and boost gold holdings to diversify away from dollar dependence.

By the numbers
• −10% — dollar decline in 2025, weakest level in four years
• 1,100+ tons — gold purchased by BRICS central banks in 2025
• 56.9% — share of global reserves held in dollars by early 2026, trending lower
• 30% — target share of BRICS development lending in local currencies by late 2026

Why it matters
A weaker dollar helps U.S. exporters and tourism but raises import costs and inflation risks, while BRICS’ steady move toward alternative payment and reserve systems challenges long-term dollar dominance in global trade.

What to watch
• U.S. rate policy and future Fed easing signals
• Dollar index (DXY) direction and capital flows
• Rollout of BRICS Pay and CBDC payment infrastructure
• U.S. trade and tariff escalation involving BRICS nations

The bottom line
Trump’s tolerance for a weaker dollar may support domestic industry in the short term, but as BRICS nations expand alternatives to dollar-based trade, the longer-term contest over global currency leadership is becoming increasingly visible.

—-- 

— 

NEXT WEEK’S KEY EVENTS

Economic Calendar: February 9 – February 13, 2026 (ET)

MONDAY, Feb. 9
• 10:50 am — Atlanta Fed President Raphael Bostic Speaks

TUESDAY, Feb. 10
• 8:30 am — U.S. Retail Sales (Delayed Report) (Dec.)
• 12:00 pm — Cleveland Fed President Beth Hammack Speaks
• 1:00 pm — Dallas Fed President Lorie Logan Speaks

WEDNESDAY, Feb. 11
• 8:30 am — U.S. Jobs Report (Employment Situation Summary) (Jan.)

THURSDAY, Feb. 12
• 8:30 am — Initial Jobless Claims (Feb. 7)
• 10:00 am — Existing Home Sales (Jan.)

FRIDAY, Feb. 13
• 8:30 am — Consumer Price Index (Jan.)

 

IMPACT ON PRECIOUS METALS MARKETS

Federal Reserve Speeches (Mon–Tue)

(Raphael Bostic — Mon; Beth Hammack — Tue; Lorie Logan — Tue)

• Hawkish tone → lifts rate expectations and supports a restrictive policy outlook; bearish for gold/silver.
• Dovish tone → strengthens easing expectations; bullish for metals.

Speech-driven volatility can quickly move Treasury yields and the dollar; moderate market impact depending on policy signals.

U.S. Retail Sales (Tue, 8:30 am ET)
• Strong spending data → resilient consumer narrative; bearish for gold/silver.
• Weak spending → growth concerns rise; bullish for metals.
Key consumer demand signal; moderate-to-high market impact.

Beth Hammack Speaks (Tue, 12:00 pm ET)
• Hawkish messaging → supports higher-for-longer rates; bearish for metals.
• Dovish messaging → rate-cut narrative strengthens; bullish for gold/silver.
Impact depends on policy signals; moderate relevance.

Lorie Logan Speaks (Tue, 1:00 pm ET)
• Hawkish commentary → lifts rate expectations; bearish for metals.
• Dovish commentary → encourages easing expectations; bullish for metals.
Markets watch Logan closely on policy mechanics; moderate impact.

U.S. Jobs Report (Wed, 8:30 am ET)
• Strong payrolls / rising wages → higher real-rate expectations; strongly bearish for gold/silver.
• Weak payrolls / softer wages → easing expectations grow; strongly bullish for metals.
Highest-impact macro release of the week.

Initial Jobless Claims (Thu, 8:30 am ET)
• Rising claims → labor-market softening narrative; bullish for gold/silver.
• Persistently low claims → labor strength supports tighter policy outlook; bearish for metals.
High-frequency labor indicator; moderate impact.

Existing Home Sales (Thu, 10:00 am ET)
• Strong sales → housing resilience narrative; mildly bearish for gold/silver.
• Weak sales → housing slowdown concerns; mildly bullish for metals.
Housing data influences growth outlook; moderate relevance.

Consumer Price Index (Fri, 8:30 am ET)
• Hot inflation print → reinforces restrictive rate expectations; bearish for gold/silver.
• Cooling inflation → supports rate-cut expectations; bullish for metals.
One of the most market-moving inflation releases; very high impact.