Gold and Silver Price Drop?

The “Success Drop”: Will Gold and Silver Replicate the 2025 Iran Reversal?

Gold and Silver Price Drop?

Gold and Silver Price Drop?

The dawn of 2026 has brought a massive geopolitical shock: Operation Absolute Resolve. With the weekend capture of Nicolás Maduro by U.S. forces, global markets are bracing for a volatile opening on Monday, January 5. While a “gap-up” in safe-haven assets is the standard expectation, a deeper look at recent history suggests a different outcome may be in store for gold and silver investors.

Gold and Silver Price Drop?

The Standard Play: The Initial Gap-Up

Market consensus from firms like Ya Wealth suggests that gold and silver will open significantly higher. Gold, which ended 2025 near $4,345/oz, is being projected by some to test $4,380/oz immediately. The logic is simple: uncertainty breeds a flight to safety. With Venezuela holding South America’s largest gold reserves and the world’s largest oil reserves, any “hot” military engagement typically triggers an emotional buying spree.

The “Midnight Hammer” Precedent

However, seasoned traders are looking back to June 2025 and the U.S. strikes on Iranian nuclear facilities, known as Operation Midnight Hammer. The market reaction that Monday provided a masterclass in the “buy the rumor, sell the fact” phenomenon:

  1. The Trap: Gold gapped up 1% at the open as headlines flashed.

  2. The Realization: As news surfaced that the operation was a surgical success with minimal follow-up conflict, the “fear premium” evaporated within hours.

  3. The Reversal: Gold and silver didn’t just flatten; they dropped. By the afternoon, gold had retreated below its Friday close. Investors realized the “threat” was resolved, and profit-taking took over.

Why 2026 Could See a “Success Drop”

There is a strong case to be made that if Operation Absolute Resolve is viewed as a completed “snatch-and-grab” rather than the start of a protracted war, precious metals may face a sharp correction:

  • Resolution of Uncertainty: Markets price in the possibility of conflict. Once the regime has been toppled and the leader captured, the “unknown” factor that drives gold prices is largely removed.

  • Profit Taking at Record Highs: Gold and silver entered 2026 after a historic 70% rally in 2025. Many institutional holders have been waiting for a high-volume “liquidity event” to exit their positions. A successful military operation provides exactly that.

  • The Dollar Factor: Historically, when the U.S. demonstrates decisive military capability, the U.S. Dollar often strengthens. A surging dollar creates a natural headwind for gold and silver, potentially forcing prices down even as the headlines remain focused on Caracas.

What to Watch for on Monday

The key for Monday’s trade will be sustainability. If gold gaps up to $4,380 or $4,400 but fails to hold those levels through the first two hours of the New York session, it may signal that the “Midnight Hammer” pattern is repeating. In this scenario, the “success” of the mission becomes a bearish signal for metals, as the world moves from “fear mode” back to “business as usual.”

Gold and Silver Price Drop?

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