After what was quite a start to 2026 for the precious metals space, gold and silver have continued to cool down as we open up the month of May. The sub asset group had been a previously highflier of the commodities broad asset class before a major blow off top move to close out the opening month of the year…. and while still positive so far in 2026 the space has certainly been one to quickly shed RS against other areas of the investment landscape. Most of the attention has shifted to the energy complex as unrest in the Middle East pushed many energy representatives higher. Meanwhile, precious metals representatives fell by the wayside, seeing the likes of GLD or SLV trading well off their recent highs. While the technical pictures are (at best) still defendable, the recent action has left broader precious metals strength in question. In fact the precious metals group on the Asset Class Group Scores page has fallen significantly. Pictured below, the average precious metals fund comes in with a score of 2.94, now below NDW’s “technically acceptable” 3.0 score threshold. While we don’t think of support or resistance for scores like we would for charts, it is at least conversationally interesting to highlight the series of lower highs when it comes to the groups average score, seemingly unable to re-establish the magnitude of long-term strength after late January’s decline.

As one asset struggles, another can catch up on a relative basis. With the move, other areas of the commodity space have caught up to precious metals. The obvious answer is energy, which quickly moved to the top of commodity rankings as supply shocks pushed energy prices higher across the globe. Outside of the energy space, the magnitude of exhale off 2026 highs also saw precious metal representatives lag behind other areas. A common RS chart the NDW analyst team will look at is that between copper (CPER) and gold (GLD). Using a 3.25% RS chart between these two funds, we can see that CPER returned to a buy signal against GLD to close out April for the first time since 2024. While this 2024 signal ended up being a headfake, the relationship has been fruitful for those following an RS switching strategy (owning whichever asset is on a buy signal) since the early 1990’s. Historically speaking, this RS relationship has also coincided with strong risk-on/risk-off signals, with gold taking over during periods of uncertainty (dotcom bubble, 2008, etc.) and copper leading as a more economically useful metal during times of economic expansion. While this most recent bull market from 2022-present has been led largely by gold, the shift back towards copper points historically that this period of expansion still has room to run.

Even with that shift in mind, it is at least worth journeying back to the default chart for CPER, which has struggled recently. Remember, relative strength charts are just that: relative, meaning a test between two assets which are struggling must still produce a “winning” asset. While still positive for the year, CPER has struggled in the near/intermediate term. Despite trading on a PnF buy signal on its default chart, the recent reversal back into O’s helps confirm a newly established negative trend. While still bringing in a technically acceptable 3.97 fund score, it wouldn’t be a surprise to see the fund head back down towards 2026 lows around $32.50. Also keep in mind that when comparing either copper (or gold for that matter) to other areas of the commodities space via NDW’s continuous commodity matrix the space lacks a significant amount of staying power. All this to say- remember to consider both the absolute and relative pictures when observing assets worth your investment, it can help contextualize shifts in strength between assets around the globe.

As we have discussed over the last couple of days, the beginning of November brings the start of the “seasonally strong” six-month period for the market. This week we have published articles around "market seasonality" and strategies to that attempt to leverage this historical bias. As we have covered, the November to May period has typically provided stronger returns than the six months from May through October. Even though that effect has been more muted in recent years, the long-term picture remains the same. We could hardly hope to explain this bias, much less the severity over time, but the "strong six months" of the year have accounted for almost all the Dow's average annual compounded return since 1950. As discussed in Friday’s report, the average return of the Dow during the seasonally strong six months has been better than 7%, while the "other" six months have produced an average return of only about 1% since 1950.

Those who have been following our research for any length of time know that sector rotation is a key aspect of many of our strategies. With the seasonal bias of the market in mind, we began to wonder how individual sectors might be affected by the seasonality phenomenon. While we don't have the same longevity in terms of data for sectors as we do for broad market indices, we have observed performance biases within the past 25+ years, which we illustrate below using the 40 DWA equal-weighted sector indices.

The graphics below utilize our inventory of 40 DWA equal-weighted sector indices, which have been "live" for the duration of our study period (most have been published since 1998), as well as a handful of benchmarks tracking equity and bond markets. The study includes market data from April 28, 2000, through April, 2026, tracking the returns of each index in the seasonal periods (the weak period spans May 1 through October 31, while strong periods span November 1 through April 30 of the following year). The results are displayed in graphs and sorted by the "median" return of each index during the seasonal period, as well as the "min" and "max" returns during the respective periods. We’ve included each graphic along with key observations from each seasonal period.

Key Observations (Weak Season - May - November)

- Despite it being the "weak" period, only five of the 45 sectors and ETFs on our list were in the red from May through October this year.

- Over the longer term, only 10 sectors have a median return higher than the S&P 500 (SPX) during the seasonally weak period, highlighting lower participation during the period.

- Semiconductors are historically the worst performer during the seasonally weak period, but there is still optimism for the group. Semis gained over 60% during the last seasonally weak period, and their 78% gain over the last six months is the 2nd best return of any group during any seasonal period, trailing only retail stocks in

Key Observations (Strong Season - November - May)

- Sector participation has historically been much stronger in the seasonally strong period as only seven sectors and ETFs show a median return lower than the S&P 500.

- Bonds show the lowest median return of any of the representatives on our list, which is consistent with the tendency towards strong equity performance.

- None of the representatives on our list show a negative median return for the seasonally strong period, underscoring the broad-based upside during those six months.

Daily Option Ideas for May 4, 2026