Gold miners’ stocks, 2025’s standout performers, faced a sharp reversal this week as investor appetite for safe havens cooled following the U.S.-China trade truce, raising fresh doubts about the sustainability of the sector’s explosive rally.
The VanEck Gold Miners ETF GDX—a widely tracked proxy for gold mining stocks—plunged 9.6% over three sessions, marking its worst three-day performance since April 2022.
The move was amplified by a 4.4% drop in gold prices, which now sit 9.2% below the all-time high of $3,500 per ounce reached on April 22.
Losses were broad-based within the GDX components. Newmont Corp. NEM, its largest holding, dropped 10% in just three days. Similar losses were recorded in Barrick Gold Corp. GOLD and Agnico Eagle Mines Ltd. AEM.
The abrupt reversal comes as risk appetite surges globally, diminishing gold’s appeal. The May 12 announcement of a 90-day U.S.-China tariff rollback helped lift equities and risk assets, reducing investor hedges in gold.
Technical Setups Signal Caution For Gold
Technical analysts are growing cautious. Bank of America technical analyst, Paul Ciana said the daily gold chart is showing signs of a potential double top pattern.
He indicated that a close below $3,200 per ounce would increase the risk of a correction to the $2,900–$3,000 range during the second quarter.
From a fundamental view, David Morrison, senior market analyst at Trade Nation, observed that gold is consolidating around the lower end of its recent range.
He flagged $3,200 as the first key support level. “It looks as if the path of least resistance may be down for gold, although much now depends on how staunchly the bulls can defend the $3,200 level,” he said.
Nikos Tzabouras, senior market analyst at Tradu.com, said the trade truce buoyed market sentiment and reduced near-term demand for havens like gold.
“Gold remains under pressure, with scope for further declines as risk appetite holds firm,” he said, while cautioning that geopolitical uncertainty and central bank buying still support the longer-term case.
Seasonality Enters Choppy Phase
Seasonal trends may also be at play. Historically, gold posts strong gains in the first four months of the year, followed by a choppy stretch between mid-May and mid-July. In that two-month window, bullion has delivered positive returns just 42% of the time over the past decade.
This seasonal lull could compound downside pressure, especially if key support levels fail to hold.
Conclusion: Time to Take Some Chips Off the Table?
While gold miners have delivered strong year-to-date returns – with the GDX ETF up 30% through mid May.
Yet, the combination of technical weakness, a seasonally soft window, and shifting macro tailwinds suggests a more cautious stance may be warranted in the short term.
For investors sitting on large gains, this could be an opportune moment to lock in profits—or at least tighten risk controls—while waiting for clearer signals.
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