The market has never lacked stories; what it lacks is certainty.
Written by: Mamengniu, Deep Tide TechFlow
Last night, the gold and silver markets staged a thrilling scene. After hitting a historic high during the trading session, gold and silver suddenly turned downward, with a drop so significant that it caught many off guard.
Precious Metals: Soaring to the Sky, Then Falling Down
In the late night, spot gold plummeted from a high of $5,598, briefly falling below $5,100, with a maximum daily drop exceeding $400. Silver was even harsher, crashing from $121 to below $110, a drop of over 6%. The domestic market followed suit, with the main contracts for Shanghai gold and silver futures all diving, with declines exceeding 3%.
The trigger behind this rollercoaster market was the situation in Iran.
Since mid-January, Trump has been flip-flopping on the Iran issue, first threatening to "send an aircraft carrier strike group," scaring the market into buying safe havens; then suddenly changing his tune to "no attack, just observing." Yesterday, President Trump stated that "a large fleet is on its way to Iran," and if Iran does not make concessions, a major strike is imminent. The situation escalated instantly.
Gold and silver, as safe-haven assets, soared, turning into risk assets.
Additionally, more direct pressure came from the exchanges' "iron fist." On January 30, the Shanghai Gold Exchange directly raised the margin level for silver forward contracts (from 19% to 20%), and the price fluctuation limit was increased from 18% to 19%. This was already the Nth time the exchange has intervened, with CME, the Shanghai Futures Exchange, and the Shanghai Gold Exchange all successively raising margins and restricting positions to cool down the overheated market.
Historically, after CME raised silver margins five times in 2011, silver prices plummeted nearly 30% within three weeks; even worse, in 1980, after the exchange banned speculative buying, silver prices collapsed from $50 to $10.
However, looking calmly, the mid-term logic remains intact. Global central banks continue to buy gold, and the credit of the dollar is contracting; these supporting factors have not changed. It’s just that the short-term rise was too rapid, making a technical correction inevitable. Silver is inherently more volatile than gold, and a short-term drop back to $100 or even $90 cannot be ruled out.
New Chair of the Federal Reserve: Trump to Announce Nominee
Another factor stirring market nerves is the personnel issue at the Federal Reserve.
On January 27, Trump publicly criticized Powell, saying he "wants to keep interest rates as high as possible," and indicated that "he will soon announce a new nominee for the Federal Reserve chair." U.S. Treasury Secretary Mnuchin revealed that the announcement could come as early as this week (the week of January 26).
On January 29, President Trump stated that he would announce the nominee for the next chair of the Federal Reserve on Friday morning (January 30).
Currently, the highest odds on the Polymarket website are for:
Former Federal Reserve Governor Kevin Warsh.
In recent years, Warsh has criticized the Federal Reserve extensively, addressing both short-term policy decisions and long-term strategic considerations.
First, Warsh has consistently criticized the Federal Reserve for its aggressive use of the balance sheet over the past fifteen years.
While he supported the quantitative easing (QE) program during the global financial crisis, he warned that continuing QE thereafter was inappropriate, as it could trigger inflation and financial stability risks, and cause the Federal Reserve to deviate from its core responsibilities, interfering in credit allocation policies that could distort market signals.
Warsh further believes that the Federal Reserve's active use of the balance sheet may have ushered in a "monetary dominance" period. He argues that by artificially keeping interest rates low for an extended period, the Federal Reserve has played a leading role in facilitating the accumulation of U.S. government debt.
On January 16, when Trump hinted that he might not nominate Hassett, the market reacted violently, with the dollar index soaring 30 points, spot gold plunging $70, and the yield on the 10-year U.S. Treasury reaching 4.23% (a new high since September). This shows how sensitive the market is to this issue.
U.S. Stocks: Microsoft Plummets, SanDisk Soars
On January 30 (Thursday), Microsoft’s stock price plummeted 9.99%, with a single-day market value evaporating by nearly $360 billion, marking the second-largest single-day market value loss on record, second only to Nvidia's nearly $600 billion loss during the DeepSeek panic last January.
The earnings report data was actually quite "bright": Q2 revenue was $81.3 billion (up 17% year-on-year), and net profit was $38.5 billion (soaring 60% year-on-year). So where did the problem lie?
The secret behind the 60% surge in net profit is that of the $38.5 billion, $7.6 billion was a one-time gain from the restructuring of OpenAI. Excluding this portion, the adjusted net profit growth was only 23%, far less impressive than it appeared.
Azure's growth rate is slowing. Microsoft’s cloud business Azure saw revenue growth of 38% year-on-year, which seems good but is below Wall Street's expectation of 39.4%. More critically, the growth rate is slowing. Azure is at the core of Microsoft's AI narrative, and as its growth slows, the market immediately panics.
Capital expenditures soared to $37.5 billion, a year-on-year increase of 66%, exceeding analysts' expectations of $36.2 billion. Microsoft CEO Nadella stated that they aim to increase AI capacity by 80% over the next two years, but the question is: with such heavy spending, when will they recoup the investment?
The core concern on Wall Street is simple: you say AI is the future, and we believe you.
However, the four tech giants—Microsoft, Meta, Amazon, and Alphabet—are set to spend $440 billion this year on AI infrastructure. Where is the return? Azure's growth is actually slowing, and its gross margin has dropped to a three-year low (68%). How can this be justified?
J.P. Morgan analysts put it bluntly: "From the information released by Meta and Microsoft, capital expenditures are all above expectations, and AI spending is accelerating. The difference is that Meta has significantly raised its revenue outlook for 2026, while Microsoft has not."
In stark contrast to Microsoft's tragedy, storage chip leader SanDisk surged 17% after hours. This company’s stock price has skyrocketed 577% since 2025, making it the top gainer in the S&P 500, and its momentum remains strong this year.
The core logic is clear: the construction of AI data centers has ignited a "storage supercycle." The storage demand for AI servers is 8-10 times that of ordinary servers, and the four tech giants (Microsoft, Meta, Amazon, Alphabet) are set to invest as much as $600 billion in AI infrastructure by 2026, with over 30% allocated to storage hardware.
Cryptocurrency: Falling Below $85,000, Where is the Faith?
Bitcoin has fallen below $85,000, retreating over 33% from its peak of $126,080 in October. Ethereum has been fluctuating in the $2,900-$3,100 range, repeatedly attempting to break through $3,300 but failing.
The most brutal comparison is here: even after a sharp drop, gold remains above $5,100, and silver stays above $110, with year-to-date increases of 20% and 40%, respectively. What about Bitcoin? It has fallen below $85,000.
Institutions are also starting to pour cold water on the situation. Standard Chartered has halved its 2026 Bitcoin target price from $300,000 to $150,000; a Coinbase survey shows that 54% of institutions believe we are currently in an accumulation phase or bear market. Trading volumes are shrinking, and liquidations are frequent (with several instances of mass liquidations in January), creating a market atmosphere filled with speculation but lacking confidence.
However, from another perspective, extreme panic and FUD may accelerate the arrival of a bottom.
Core Logic: Policy Uncertainty Dominates Everything
The market on January 30 essentially told one story: uncertainty.
Precious metals experienced a technical correction due to rapid gains, and exchanges tightened regulations, leading to concentrated profit-taking. However, the mid-term logic remains intact— as long as dollar credit continues to contract and central banks keep buying gold, adjustments present opportunities.
The personnel game at the Federal Reserve is the real focus. Riedel (dove) or Warsh (hawk)? What does Trump really want? Can the independence of the Federal Reserve be maintained? The answers to these questions will determine the path of interest rate cuts in 2026, and subsequently dictate the medium- to long-term trends of the dollar, gold, and the stock market.
Cryptocurrency finds itself in the most awkward position, lacking the safe-haven consensus of precious metals and the performance support of tech stocks, relying solely on speculation.
The market has never lacked stories; what it lacks is certainty.
Currently, that certainty lies in Trump's hands.
Risk Warning: The risk of a short-term technical correction in precious metals is increasing, with silver being particularly volatile; the choice of the new Federal Reserve chair will determine the direction of monetary policy, and any loss of independence may trigger a confidence crisis; cryptocurrencies have fallen below key support levels, highlighting high leverage risks; concerns about the AI bubble in U.S. stocks are rising; the situation in Iran and tariff policies bring geopolitical uncertainties; market volatility is severe, requiring cautious decision-making and reasonable position control.
This article is merely a market observation and does not constitute investment advice.
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