Spot gold is trading around $3,363.90–$3,360 per ounce, slightly off recent highs amid easing safe-haven demand as trade optimism rises. Meanwhile, spot silver has climbed to ~$39.40–$39.14 per ounce, the highest level since 2011, outperforming gold with a year-to-date gain of ~36%.
The ratio of gold miners (represented by the XAU index or ETFs such as GDX) to spot gold has formed a falling-wedge base over roughly thirty years, with a rising triangle pattern established since 2014, a textbook technical setup signaling potential bullish breakout. Market commentators now suggest the ratio is nearing a breakout, which, if confirmed, could signal miners outperforming bullion for years ahead, with technical upside estimates approaching 500% in relative terms.
Over the past decade, the VanEck Gold Miners ETF (GDX) and the SPDR Gold Shares ETF (GLD) have delivered nearly identical total returns (~168–169%), but mining stocks endured much higher volatility and sharper drawdowns. GDX’s worst peak-to-trough decline hit 43%, versus less than half for GLD. Meanwhile, over a 20-year horizon, the miner-to-gold ratio has declined ~75%, underscoring miners’ historical underperformance relative to bullion.
In a recent tweet, Crescat Capital's Tavi Costa highlighted the setup, a sentiment echoed by the ratio’s technical formation.
As noted in March, the GDX index, a proxy for miner performance has risen ~28% this year, outpacing gold’s ~19% gain, hinting at shifting investor sentiment toward miners taking the lead. Analysts at Investing.com and Kitco underscore that miner valuations remain cheap relative to gold, even as technical signals align for potential catch-up in 2025 and beyond.
OANDA’s Kelvin Wong commented, “profit-taking from short-term bullish speculators” has tempered gold prices in the short term, but the weaker U.S. dollar and continued Fed rate-cut expectations support gold near current levels, conditions often favorable to miners gaining upside leverage.
After over a decade in relative slump, gold-mining stocks may be on the verge of breaking out of a long consolidation against gold. With bullion near historic levels, improving fundamentals, and technical patterns pointing higher in relative terms, miners may finally reclaim their leveraged upside. Investors should watch for confirmation of a sustained breakout and align strategy accordingly.