The Cyclical Battle: Stocks vs. Gold

Source: John Newell 01/02/2026

John Newell of John Newell & Associates shares a concise, educational perspective, taking a look at the long-term ratio between the S&P 500 and gold.

This chart tells a story most investors rarely look at, yet it has shaped returns for decades.

What you’re seeing is the long-term ratio between the S&P 500 and gold. When the line rises, stocks are outperforming gold. When it falls, gold is winning. Simple concept, but powerful when viewed over long periods instead of short market cycles.

Over nearly 60 years, leadership between stocks and gold has rotated in long, persistent waves. These shifts are structural, not tactical, and they often last close to a decade.

From the late 1960s into the 1980s, gold dominated as inflation and monetary stress pushed investors toward hard assets. From 1980 to 2000, stocks took over during the great disinflation and tech boom. That leadership flipped again from 2000 to 2011 as financial crises and aggressive monetary policy drove another gold cycle. From 2011 to around 2020, equities reclaimed leadership.

What matters isn’t the dates. It’s the rhythm.

The most interesting part of the chart is the similarity between past cycles and the current setup. The circled areas highlight nearly identical topping patterns in the ratio. In both cases, the ratio peaked, corrected, attempted to recover, and then failed. These repeating structures, often called fractals, reflect human behavior more than math.

In the current cycle, the ratio rallied into a key Fibonacci retracement near the 0.618 level, a zone where countertrend rallies often fail. Since then, the ratio has rolled over again, suggesting gold is beginning another period of relative outperformance.

This does not require stocks to collapse. Gold doesn’t need chaos to outperform. It simply needs to lose less or rise more over time. Historically, that has been enough to drive meaningful capital rotation.

Most portfolios today are still positioned for the last decade, not the next one. Yet, 2025 has already delivered an early signal, with gold and silver outperforming broad equity markets and mining margins expanding sharply.

I’ve watched this ratio for a long time. It doesn’t flash signals often. But when it does, they tend to matter.

Markets rotate. They always have. This chart suggests leadership may be shifting again.

As for stocks to look at, after three years of strategic patience, Triumph Gold Corp. (TIG:TSX.V; TIGCF:OTCMKTS) is re-emerging with fresh momentum. You can read my full article on them here.

At ~US$12/oz -~US$15/oz in the ground, Triumph trades at a fraction of its 2017–2019 valuation and offers long-term investors a clear asymmetry; therefore, I believe that the shares are a Speculative Buy.

The company has already met and exceeded my first and second price targets. The next targets are as follows:

• Third Target: CA$1.10, coincides with the major support turned resistance from early 2022
• Big-Picture Target: CA$3.45, emerges if the full retracement plays out over a longer timeframe

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Important Disclosures:

1. John Newell: I, or members of my immediate household or family, own securities of: None. My company has a financial relationship with: None. My company has purchased stocks mentioned in this article for my management clients: None. I determined which companies would be included in this article based on my research and understanding of the sector.
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John Newell Disclaimer

As always it is important to note that investing in precious metals like silver carries risks, and market conditions can change violently with shock and awe tactics, that we have seen over the past 20 years. Before making any investment decisions, it’s advisable consult with a financial advisor if needed. Also the practice of conducting thorough research and to consider your investment goals and risk tolerance.

( Companies Mentioned: TIG:TSX.V; TIGCF:OTCMKTS, )

Source: https://www.streetwisereports.com/article/2025/01/02/the-cyclical-battle-stocks-vs-gold.html