Analysis: The core logic of the Gold and Silver bull market remains unchanged, but short-term positioning has become excessively crowded

February 3rd — Several institutions note that the sharp rebound in gold and silver prices following a historic sell-off stems more from position adjustments and short-term catalysts than a trend reversal. While technical indicators appear overheated and positioning is crowded, the medium- to long-term drivers underpinning the gold and silver bull market remain solid. Deutsche Bank argues the recent sell-off in the metals has far outpaced apparent bearish signals. The willingness of official, institutional, and individual investors to allocate to gold and silver hasn’t materially weakened, and the current environment differs fundamentally from the long-term weakness phases the metals saw in the 1980s or 2013. Barclays also points out that gold demand remains resilient amid geopolitical uncertainties, rising policy risks, and ongoing reserve asset diversification. For silver, while its volatility is more pronounced due to its smaller market size and high retail participation, its industrial properties are emerging as a key support. Analysts emphasize silver demand is growing in sectors like solar energy, data centers, and AI infrastructure. With supply growth expected to lag demand expansion in the coming years, the projected supply-demand gap remains unchanged — reinforcing the foundation of the silver bull market.