In this video: Is the stock market breaking down against Gold? Video by Benjamin Cowen.
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The stock market is currently showing signs of breaking down against gold as of January 20, 2026. A sharp global sell-off triggered by geopolitical tensions has pushed equities to three-week lows, while gold has surged to record highs above $4,700 per ounce.
The S&P 500-to-Gold ratio, a primary measure of stock performance relative to the metal, fell to 1.51 as of January 16, 2026, confirming a downward trend that began in late 2025. This ratio indicates that while equities remained resilient for much of last year, gold's 65% rise in 2025 far outpaced the S&P 500's 16% gain, a divergence that suggests a significant shift toward defensive positioning.
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Key Market Dynamics (January 2026)
--Gold Breakthrough: Spot gold reached an all-time high of $4,750.49 on January 20, 2026, driven by trade war fears and concerns over political interference with the Federal Reserve.
--Equity Decline: The S&P 500 dropped 1.29% in early trading on January 20, while the Nasdaq Composite fell 1.56%, as a dispute over Greenland triggered a global sell-off.
--Structural Trend: The Dow-to-Gold ratio has also collapsed from 17x a year ago to approximately 11x by early 2026, reflecting a confirmed long-term technical breakdown in favor of gold.
--Outlook: Major financial institutions, including Citigroup and J.P. Morgan, have revised their targets, with gold expected to reach $5,000 per ounce later in 2026 as safe-haven demand intensifies.
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