The Bull Case Is in the Margins -Jeff Valks, Senior Analyst
@TheGoldAdvisor · · 1 upvotes · 0 replies
Gold spent the first half of 2026 reminding everyone that bull markets will still try to buck the rider.
After peaking above $5,400 an ounce for a hot minute earlier this year, gold pulled back hard enough to shake money out.
After falling below $4,000 three times in July, spot prices are back over $4,360 in August.
I referenced this the last two week, stating buyers rushed in to scoop the sub-$4,000 prices.
That rebound is encouraging, yes, but the BIG story for miners never really disappeared.
Don’t Confuse Lower with Low
As Bristol Gold Group recently illustrated, the economics at these prices remain exceptional. Using an estimated industry average AISC of roughly $1,750 an ounce, Q2 gold prices near $4,500 implied cash margins approaching $2,750 an ounce — about 63% higher than the 2025 average.
That’s the real story.
We spent years begging gold to hold $2,000.
Now the crowd feels nervous because prices fell from $5,400 to just below $4,000 in the span of 6 months.
Pick almost any long-term chart and you’ll find prices that got carried away in both directions. Gold’s January spike may prove to be one of them. July’s sub-$4,000 prints may prove to be another.
Markets have a funny way of moving the goalposts once everyone gets comfortable. Over time, though, price usually finds its way back toward something more sensible before mounting another climb.
Bristol’s comparison also shows gold miners currently posting stronger margins and free-cash-flow yields than the broader S&P 500.
So yes, I love seeing gold bounce.
But the bigger point is simpler: the miners never needed $5,400 gold to make this work.