VanEck Junior Gold Miners ETF (GDXJ) Forum Analyses

Since gold broke above its previous high from 2020 at the beginning of 2024, it has been soaring.

Major banks have made massive purchases - a clear indication of growing institutional confidence, but also growing skepticism on the market.

📌Historical perspective: inflation and precious metals

Historically, gold and silver have performed particularly well in times of high inflation. While paper money loses value, precious metals traditionally offer security and value retention.

👉 The historical price ratio between gold and silver is also interesting.

Historically, this ratio has usually fluctuated between 15:1 and 80:1, currently it is in the higher range (approx. 89)which suggests that silver has the potential to catch up in the long term.

🆘Gold & silver in stagflation

In stagflation scenarios - economic stagnation combined with high inflation - precious metals have performed above average in the past.

👉 During the stagflation in the USA in the 1970s, the price of gold exploded from around 35 to around USD 850 per ounce.

Currently, many experts see a possible stagflation emerging again, triggered by high national debt, geopolitical tensions and a fragile economic situation.

This could be a catalyst for further price increases in precious metals.

📈Bull market 2025 and beyond?

Fundamentally, there are many reasons for a continuation of the bull market in gold and silver:

🪖 Persistent geopolitical uncertainties
🆘 Possible stagflation in the USA and Europe
📉 High government debt and expansionary monetary policy
☀️ Particularly for silver: strong growth in industrial demand from electronics, solar energy and electromobility

The main arguments against this are possible interest rate cuts or a surprisingly strong economic recovery, which could lure investors back into risk assets.

👇 In the following sections, we will now take a look at the charts.

If you are not familiar with chart technology, it is best to skip straight to the conclusion at the bottom

📌 Gold chart

☕Cup-and-handle formation

A cup-and-handle formation is a bullish (positive) chart pattern that often develops over several years. It resembles a cup with a handle and often signals a long-term trend reversal to the upside.

The formation consists of:

Cup: A long, u-shaped recovery that occurs after a sharp price rise and subsequent correction.

Handle: A shorter correction phase after the recovery before the price finally breaks out and ideally starts a long-term bull market.

👉 From 2011 to 2024, gold formed a clear cup-and-handle formation. (Cup: 2011 to 2020 - Handle: 2020 to 2024)

The most recent breakout from this formation in March 2024 could mark the start of a new long-term bull market.

📌 Silver chart

🧐 It is worth taking a long-term look at silver since 1960:

Silver reached a spectacular high in 1980
A new high was only just reached in 2011

📈 Silver is currently approaching this all-time high again.

A long-term cup-and-handle formation can also be seen here:

Cup: 1980 to 2011
Handle: 2011 to today (possibly completed soon)

👉 Technically, silver may be on the verge of a possible long-term breakout, which is extremely exciting.

📌 Conclusion

I currently see strong arguments for investing in gold and silver in the fundamental data and the technical charts.

Yesterday (18.03.2025) I increased my silver position in $PHAG (-4,04 %) in order to benefit from a potential rally.

I have to say that my investment horizon for gold and silver is very long (20+ years), as I consider precious metals to be the cornerstone of my portfolio.

This is the current composition of my precious metal portfolio:

GOLD:
$EWG2 (-0,53 %) , $IGLN (-2,39 %) (3.75% of my portfolio)
SILVER:
$PHAG (-4,04 %) (2.40% of my portfolio)
Gold mining ETFs:
$SPGP (-8,43 %) , $GDXJ (-8,98 %) (1.92% of my portfolio)
Individual shares (very speculative):
$BTO (-8,25 %) , $FF (-3,66 %) , $FR (-13,65 %) (< 1% of my portfolio)