2025-2026 has been like a game of hot potato with the next commodity. We’ve rotated from precious metals, to base metals, through to energy. Agricultural commodities are next.

Each commodity will have its moment, but timing matters. Late in, you miss the move. Late out, you’re sitting through bruising drawdowns.

In this article we explore whether we’re early, the timing for a potential move, how to express the thesis, and where it could go wrong.

Context

To know where we’re going, it helps to know where we’ve been. Here are the narratives that accompanied each rotation:

1. Gold/Silver: The world is becoming unstable, governments are debasing currencies, sanctions are weaponising the financial system, and central banks are buying. Hold neutral money that cannot be printed.

2. Copper/base metals: When precious metals run, all metals tend to catch a bid. Raw materials are being consumed in the AI infrastructure buildout, and a decade of underinvestment in mining has left supply of many base metals structurally short.

3. Oil/Gas: ESG had starved the sector of capex for a decade. The EV transition hadn’t killed demand the way people assumed. Energy security had been chronically underpriced. Then the Strait of Hormuz closed, and the trade stopped being abstract. Oil and gas prices ran wild.

4. Agriculture: Next. Let’s get into it.

Agriculture Thesis

Background

There are a number of scientific and technological innovations which have allowed for rapid growth in crop productivity. None of these had a bigger impact than the ability to produce synthetic nitrogen fertilizer.

Fundamentals

Most people are tracking what the Iran conflict has done to oil prices. Fewer are paying attention to fertilizer. Specifically, nitrogen, the single most important input for growing the crops that feed the world.

Urea

Urea is the world’s most widely produced nitrogen fertilizer. Prices have doubled since November, and with the Strait of Hormuz still closed, the direction of travel is up.

Around 1/3 of the world’s urea transits through the strait. Some countries import natural gas and produce their own urea domestically, India being the most notable example, but that natural gas supply is also curtailed and stuck behind the strait.

The Middle East dominates global urea supply, and right now, every major alternative source has a problem of its own:

• Russia is still at war with Ukraine.

• Qatar and Saudi Arabia are stuck behind the strait.

• Iran obviously is at war.

• Egypt depends on Israeli natural gas, which has been cut.

Are there alternatives to Urea or other nitrogen based fertilisers?

Within the nitrogen complex there are alternatives, UAN (liquid nitrogen fertilizer) being the main one, but it faces the same supply constraints.

If urea prices spike and UAN looks cheap, demand shifts to UAN and raises that price too. There is no release valve.

For fertilizer, unlike oil and gas, there is no strategic reserve. It is bought on demand.

It’s also not possible to substitute nitrogen with potash, or potash with phosphate. Each plays its own distinct role in the soil.

How does this impact farmers?

Back in 2021-22 during the start of the Russia-Ukraine conflict, the concern was losing Ukrainian wheat. Grain prices surged and farmers had a higher value for what they were selling. Rising input costs were painful, but rising crop prices provided an offset.

Farmers face rising input costs with no uplift in crop prices yet. It might be the most difficult cost-price squeeze the farming industry has seen. Farm bankruptcies are accelerating as the gap between production costs, seeds, fertilizer and fuel, and the market prices received for crops, corn, and wheat, has rarely been wider.

The longer this goes on, the more the supply picture shifts. Less fertilizer means fewer planted acres, which means lower yields. The market narrative moves from “we still have plenty of supply” to “we have lost significant yield potential and need to start pricing that in.” Other farm input costs, particularly diesel, have also risen sharply, adding further pressure to already thin margins.

Sentiment

I always like to do a gut-check on sentiment before parking money somewhere, and seeing as I don’t know any farmers personally I’m having to dig through farm-related Youtube videos to find anything of value. This Youtube channel is great, here’s one video example of many:

As one would expect, many of the comments are referencing pain, uncertainty, and the rising input costs, which is something you see nearer bottoms than tops:

What are the consequences for grain prices?

With limited fertilizer, the question is who gets supply and at what price. The US and Brazil can bid high enough to secure fertilizer. Australia has a major buying season approaching. Many farmers have not yet purchased their spring fertilizer needs, and now that they are buying, the price has moved sharply against them. Some will reduce application rates. Some will plant fewer acres.

On a crop-by-crop basis, the thinking is:

Wheat is the most interesting. Non-US countries have a more wheat-dominant food chain and more wheat acres. Most countries grow wheat, so any supply disruption travels further and faster through food systems.

Corn is planted in early April, and some farmers may choose to switch to soybeans, which require less nitrogen input. The market is currently pricing in a strong corn yield. If acres shift to soybeans, that assumption breaks. Either way, corn is the heaviest nitrogen user in US agriculture, so it is the first place where fertilizer cost pressure shows up in farmer margins.

The longer the strait remains closed, the worse the situation becomes.

When do we expect grain prices to increase?

The repricing in grain markets is unlikely to start before June-July, when farmers make planting decisions and begin to assess the fertilizer price impact on the 2027 harvest.

Most farmers have not started planting yet, apart from the deep south. Planting typically begins in the first and second weeks of April and runs through the month.

Take a look at the 2022 increase in urea prices. It took a few months for the increases to be reflected in commodity price index, signalling a lag between input costs, and the underlying commodity costs.

Compounding factors

Ethanol Production

When oil becomes expensive, ethanol becomes used as substitute fuel, and demand for corn and sugarcane as ethanol inputs rises alongside it. Food and fuel are now competing for the same crop.

Brazil makes this dynamic particularly acute, Brazilian mills can swing their entire sugarcane crush between sugar and ethanol production depending on which is more profitable at any given moment. When oil is high, they tilt toward ethanol, global sugar supply tightens, and prices follow. So this adds to the Corn thesis, and also puts Sugar on the radar too.

USDA Survey

US wheat planted area has hit a century low, adding a structural supply constraint on top of the fertiliser shock

Weather

The US corn belt is forecast to be very wet over the next few weeks, right as planting is about to begin. Below-average temperatures follow the rain, which extends the dry-off period and pushes planting dates later. Meanwhile the wheat belt is seeing little to no rain with above-average temperatures, stressing early crop development. The weather market is opening early this year, and it is not opening in farmers’ favour.

The bear case

If the strait opens tomorrow, urea prices could sell off sharply. Even so, vessels currently take around 30 days to sail to destination markets, which means supply cannot reach farmers in time for spring planting regardless.

Also, corn has been range-bound between 460 and 470 and needs a catalyst to break to the upside. The fertilizer supply story is now widely known and is arguably priced in. Any sign of de-escalation in Iran could trigger profit-taking. Strong farmer selling has capped the rally at current levels, and if consumers are not adding to positions, a demand air pocket could cause a sharp reversal.

Finally, if we’re bound for a global recession, lower fuel demand means lower ethanol demand, which means lower corn demand, since a meaningful share of US corn production flows into ethanol blended at the pump.

Technicals

Both wheat and corn futures tell a similar story from a technical perspective.

Wheat peaked near 1300 in 2022 following the Russian invasion of Ukraine, then spent the next three years in a grinding downtrend.

Price is currently sitting around 606, having recently broken out of a descending wedge formation, a pattern that typically precedes a trend reversal. The next major resistance sits at 750. A clean break above that level opens the door back toward the 1000 range and potentially a full retest of the 2022 highs above 1300.

Corn futures are trading around 467, above a long-term upward trendline that dates back decades. The pattern is constructive. Next major resistance is around 700. Above that, the 2022 highs near 850 come back into play.

Both charts need a catalyst to break through current resistance. The fertiliser supply shock may be that catalyst. If the fundamental thesis plays out over the coming months, the technical setup is already in place to support a significant move higher in both markets.

How to express the thesis

How you access this trade depends on where you’re based.

For US investors, Teucrium offers the cleanest single-commodity exposure. WEAT tracks wheat futures and CORN tracks corn futures, both listed on the NYSE.

For European investors, WisdomTree offers UCITS-eligible ETCs for both wheat (WEAT) and corn (CORN), listed on the London Stock Exchange, giving clean, direct exposure without the US tax wrapper complications.

If you want broader agricultural exposure in one instrument, DBA from Invesco holds a basket that includes corn, wheat, sugar, coffee, cotton, and live cattle. You get diversification but lose the specific torque on corn and wheat that the thesis calls for.

Conclusion

The bet on corn and wheat is ultimately a bet on inflation diffusing from energy into food. It is also a bet that the Hormuz situation takes longer to resolve than the market currently expects.

The thesis breaks down in a deflationary bust. If global demand collapses, energy falls, fertiliser costs ease, and the entire chain unwinds. That is the primary risk to hold in mind.

But when input costs rise sharply and farmer margins are already negative, history suggests it finds its way into the bushel price. The lag is months, not years. The window to be early is closing.

In the last century, a few assets drove most market returns. Those who made the most money found these assets early, bought in while others waited, and exited at the top.

Many get one of these steps right, but not all three. This article series focuses on mastering all three: spotting the start of a megatrend, riding it, and exiting at the peak.

Overview

Before we jump into the framework, one prerequisite: curiosity.

Not curiosity about markets or investing specifically. Curiosity about everything, especially the Zeitgeist. Think like a detective — the criminal rarely walks in and confesses. You’re hunting for anomalies, often anecdotal, that build a case beyond reasonable doubt. Signals in places others aren’t looking.

Start with asset, industry, or something more broadly in the Zeitgeist that seems extreme or dismissive. A headline that feels like it captures negative sentiment in a neat package: ‘death of the dollar’, ‘gold, a pet rock’. It’s only when you look closer that the contradiction appears.

What you’re looking for is a gap between the narrative and reality: between what people are saying and what the fundamentals actually show.

One way to find this is to read mainstream media backwards: look for what’s ignored, mocked, or fought over, not what to buy. Listen to people in real life without asking loaded questions and pay attention to negativity, ideology, dismissiveness. That’s a signal to dig deeper.

The cocktail looks like this: ‘it’s bad, and it can get even worse’ in the headlines, yet you observe demand outpacing supply, and a price chart that looks like roadkill…

Every signal you find will point to one of three things: how people feel about an asset, whether the underlying numbers support a different story, and what the price itself is doing. Narrative. Fundamentals. The chart.

All three need to be in harmony. Two out of three is interesting. Three out of three is a megatrend.

The Framework

Narrative - Is it hated enough?

The “you’re wrong” narrative needs to be loud. If everyone already agrees with you, who’s left to buy?

At the start of a megatrend the asset or industry is despised, laughed at, ideologically dismissed.

To get a proper read on the narrative, you want signals from multiple sources, not one person’s opinion. Aim for five or more real life conversations, ask unloaded questions, and look for themes across the responses. Social media and mainstream media work too, just know the demographic you’re talking with.

Below I have categorised examples of conversations from my real-world experience. I’ve given these individuals ‘personas’ to help them come alive, they are your involuntary truth-tellers, that help provide clues about what to look for not an exact science:

The Headline Reader. Someone who knows little about the industry or asset but speaks confidently about it. They’re regurgitating headlines, not doing research, which makes them a perfect proxy for the popular narrative. It doesn’t need to be an investing conversation. I got interested in energy through hearing the same scathing take on oil and gas industry repeated by people whose opinions were informed almost entirely by headlines, with no research behind them. That led me to dig deeper.

The veteran insider. A farmer for agri commodities, a gold stacker, someone who has held an asset for years. Still in. Still convinced. Ask them about the price and watch closely. You’re looking for a discrepancy between their words and their body language. Vocally defensive: “I knew it would drop, I’m just buying more.” Said through slightly gritted teeth and a slightly pained look. The words are confident. The body isn’t. Nobody ever sells as much as they wished before a drop. So you see both truths at once, one from the voice, one from the body.

The Burned Beginner. Someone who has been in the asset less than a year with little investing experience behind them. Ask them about it and watch what happens. People rarely admit they sold at the wrong time, so you're not listening for a confession. You're looking for the brush-off. "Oh yeah, that thing, not doing that anymore." Casual words, but something happens in the chest before they say it. A slight pull back, a closing off. They've moved on because it hurt, and they don't want to say so.

The Regulator. Watch for bans or threats of bans, punitive taxation, government inquiries, and central bank warnings. When the state starts swinging at an asset or industry, it’s a reliable signal that it’s deeply out of favour. If it weren’t, the public outcry would make it politically impossible.

The ECB is a good example. In November 2022, with Bitcoin sitting around $16,000, two ECB economists published a blog post titled “Bitcoin’s Last Stand.” They called it irrelevant, unsuitable as investment or payment, and an unprecedented polluter. It felt most true at precisely the moment it was least true. Within two years Bitcoin was trading above $100,000.

Media. Watch for schadenfreude, fearmongering, and the “it can only get worse” tone. Media mirrors sentiment almost perfectly because fear sells, and especially so at the moment when the most panic is present. The most damning headlines often arrive at the bottom, not the top.

Fundamentals - is there a supply and demand imbalance?

For commodities and Bitcoin alike, supply and demand is what matters most. We could spend a whole series on the metrics that help inform your view here. At its core though, you’re looking for stark imbalances that fit the context of what is happening globally.

The difficult part is being early. By the time the fundamental case is obvious to everyone, the price has usually already moved. You either need to develop the thesis yourself, or spend time in corners of the internet where others are thinking about it early. The mainstream will catch up eventually. That’s the point.

Let's walk through a real example you can use as a template: during covid, a barrel of WTI oil briefly went negative. Do you remember that day? The headlines?

Was your instinct to invest? Mine neither. But that’s exactly the moment this framework is built for.

Think about what you actually knew at the time. Oil is in almost everything that isn’t a rock, a plant, or a metal. The breakeven for most producers sits around $60 a barrel, below that and production stops being economical.

So the question was simple: would humans stop needing clothing, heating, hospitals, transport? Or would demand return and price have to follow? Obviously the latter.

But our brains default to reading crashes as endings rather than beginnings. That instinct is the enemy of investing if you choose to listen to it, or your best partner when you choose to do the opposite.

Technical Analysis - Is it true roadkill

You've found a hated asset with strong fundamentals that are not widely known. Not so fast. The chart is the final check. It contextualises everything above and confirms whether you're at the start of something or not.

The first thing to look for is where price already is. If it has already moved significantly, the opportunity may have passed. Gold rose roughly 100% in the two years before the 2026 Middle East escalation. You might expect it to catch a bid on geopolitical risk. But gold failing to make new highs in the early stages of the conflict was a signal of exhaustion, not opportunity.

What you want to see is the opposite: a beaten down chart showing the culmination of a downtrend. A brutal, extended sell-off pushing into genuine panic, followed by a slight stabilisation. Then the price attempts to break lower again. If that second attempt fails, accompanied by really bad news, that is your signal. The bad news arrives, the price tries to break down, and it can’t. That’s where the maximum opportunity lives.

Below are two examples of what this looks like on a chart. Both show the same pattern: an extended decline, a stabilisation, and a failure to make new lows. Both felt like the end at the time.

Study ‘bottom’ charts carefully, because at the point of maximum opportunity it will not feel like it. That’s the point.

I learned this the hard way in 2013. I had been buying Bitcoin all the way down from $265 to $60. Then the Silk Road bust hit on October 2nd. The FBI had shut down the dark web marketplace that Bitcoin’s transaction volume was heavily tied to at the time. I convinced myself it would fundamentally impair the price and sold a large chunk as Bitcoin dropped from $120 back to $60.

A few weeks later it was at $1,200. I had panic sold near the bottom.

The Silk Road news was exactly the kind of catastrophic headline that signals exhaustion rather than continuation. Really bad news. Price already beaten down. Second attempt to break lower. I had every ingredient in front of me and still sold. The urge to sell at that moment is overwhelming. The wisdom is doing the opposite.

That's how you find the bottom. Part 2 is about what happens next: how to ride a megatrend without shaking yourself out of it before it's done.

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After 12 days of bombing in the Middle East, markets are still operating in the fog of war. These times can be disorienting, and in that confusion it’s easy to latch onto the loudest, simplest explanations. But these narratives can be misleading.

In this piece, we’ll examine some of the stories currently circulating in markets and why they can feel convincing in moments like this. We’ll suggest that the real opportunity lies in stepping beyond the fog and looking for the dynamics that aren’t being widely discussed as clarity slowly returns.

Setting the Scene

The conflict has been polarising for markets and participants alike. Commentators are making drastic calls about the impact to the economy and the outlook for stocks:

The recessionistas are calling for an imminent downturn. AI is displacing white-collar jobs. Oil supply is being choked in the Strait of Hormuz, pushing energy prices higher and squeezing consumers and businesses alike. Layer on housing at all-time highs relative to incomes and historically weak household borrowing, and the result, they say, is straightforward: rising costs, weakening demand, and a recession.

The inflationistas agree oil prices could rise, but they see structural forces keeping the economy afloat. G7 rearmament, supply chain reshuffling, and a massive buildout of data centers and power infrastructure are all driving sustained demand for labor, capital, and energy. Higher prices, in their view, don’t tip the economy into recession, they just keep inflation elevated while growth carries on.

In uncertain times, people default to binary outcomes. But that’s not how markets work. The reality is complex, and that complexity creates opportunities.

Narratives

“Gold always rises during major geopolitical shocks.”

It fascinates me how people adopt simple rules for complex events.

Over time, these rules become accepted wisdom. If X happens, then Y must follow. One common example is the belief that gold always rises during geopolitical shocks.

It makes sense. War creates uncertainty, uncertainty drives investors toward safe havens, and gold is one of the oldest safe-haven assets.

But it’s not true.

Sometimes gold rises during geopolitical shocks. At other times it barely reacts, or declines.

Take the current Iran 2026 conflict. Gold spiked slightly on the day of the event, but was down 1.5% over the following seven days.

Context matters. Gold had already risen 25% in 2026 before the conflict began. The move had already occurred before the narrative arrived.

Think of markets like a chess game where the rules are always changing and you need to be three or four moves ahead. By the time a narrative reaches consensus, it’s too late. Then the rules change.

Here’s a quick illustration. A trader calls for gold to spike on geopolitical risk. Another responds sarcastically: “so brave.” When a trade becomes obvious enough to be mocked, the move may already be exhausted.

Three lessons follow.

• Simple market rules are rarely reliable: if a relationship sounds obvious, it may already be priced in.

• Context matters: if a large move has already taken place, weakness once the narrative becomes obvious can signal exhaustion.

• The best trades emerge before consensus forms: by the time a narrative feels widely accepted, the opportunity has usually been rinsed.

“The USD goes up when conflict occurs.”

The USD is also seen as a safe haven during conflicts. The DXY did rise after the US-Israel-Iran conflict began, and it also rose after the Russia-Ukraine war.

But that’s not the rule.

The USD is not governed by war. It moves relative to other currencies based on countless factors.

The current shock highlights a deeper complication: markets can anticipate events.

There were already signs of a USD uptrend at the start of 2026, two months before the conflict began.

Which came first, the price move or the explanation for it?

Some will argue that the dollar strengthened because markets anticipated the conflict. Others will say the dollar was already set to rise for entirely different reasons, and the war narrative simply arrived afterwards. The truth contains elements of both. By the time an event is newsworthy, prices have often already moved.

At The Macro Frame, we turned bullish on the USD in February 2026 for reasons that had nothing to do with war. Our view was based on market psychology and technical signals developing in gold markets, patterns that have appeared repeatedly over decades.

This highlights another lesson: major market moves rarely come from a single cause. They emerge from confluence. Market psychology, technical structure, fundamental pressures, and the news cycle often align at the same time. When multiple forces point in the same direction, the probability of a move increases. Miss one signal and the outcome may still be the same.

That is why our framework combines psychology, fundamental analysis, and technical analysis. When those forces align, we act.

“Oil went up, so oil companies like Exxon will go up.”

Sometimes markets do have clearer mechanics.

Oil has more transparent supply and demand dynamics than the USD. Around 20% of global oil passes through the Strait of Hormuz, so disruptions there have a meaningful impact on supply. Oil prices had not surged dramatically in 2026 before the conflict, which meant there was room to move higher once geopolitical risk increased.

But look at the data across eleven conflicts since 2001. Oil has risen in some cases and fallen in others, depending on the specific dynamics of each event. The Aramco attack, which was the largest single-day oil spike in history, had fully retraced within a month.

Traders were correct that oil would rise for the Iran 2026 conflict. However, many also assumed oil equities would rise alongside it. That is not the same thing.

Crude oil reflects the price of a physical commodity today. Oil equities represent businesses valued on years of future production. Front-month oil can surge while oil stocks remain muted or decline.

This is where many pundits got the trade wrong. Their view on oil was correct, but their instrument was not.

An oil company is not a barrel of oil. It is a business with years of future production, capital costs, and broader sector exposure. Identifying the right trade is only half the job. The other half is choosing the right instrument to express it.

Hidden Dynamics

So far we’re 12 days into the conflict and it remains unclear how or when it will end.

While most commentary obsesses over the loudest narratives, gold, oil, and the dollar, the more interesting question is what markets are missing.

1. Natural Gas: The Catch-Up

Oil has dominated the headlines, but natural gas has received far less attention. Yet it may be where the more acute supply shock is playing out. Qatar has declared force majeure on roughly 25% of global LNG supply, sending European gas prices sharply higher. US Henry Hub has followed, albeit more modestly.

Retail attention remains locked on crude while the LNG story plays out more quietly. This is exactly the kind of divergence that tends to close eventually, and quickly.

The fundamentals reinforce it. Natural gas is unavoidable for grid stability, industrial production, and powering the data center buildout behind AI. Nuclear is the likely long-term answer, but new capacity is a decade away. For now, gas fills the gap.

2. Coal: The Fuel Nobody Wants to Talk About

Taiwan has 11 days of natural gas reserves. All of it comes from Qatar. With force majeure declared on roughly 25% of global LNG supply, Taiwan is already diverting orders to Australian and Indonesian coal. South Korea and Japan are not far behind. Europe, facing the same gas squeeze, is turning to South African and Polish coal.

The political calculus is straightforward. Between the pollution 20 years from now and no electricity today, every politician makes the same choice.

This is the fuel-switching mechanism playing out in real time. When Henry Hub rises and LNG tightens, coal doesn’t disappear — it comes back. The seaborne thermal coal market, which most investors have written off entirely, is now the marginal supplier to some of the world’s largest economies.

Indonesian, Australian, and South African producers are the direct beneficiaries. They were unloved before this conflict began. That’s precisely why the move, when it comes, tends to be fast.

Examples

• Australian: Whitehaven Coal (WHC.AX), New Hope (NHC.AX), Yancoal (YAL.AX)

• Indonesian: Adaro Energy (ADRO.JK), Bukit Asam (PTBA.JK)

• South African: Thungela Resources (TGA.L / TGA.JSE)

Conclusion

The narratives forming right now feel urgent and convincing. They always do in the fog of war.

But as we’ve seen with gold, the dollar, and oil, the rules that feel most reliable during a crisis are often the ones with little historical support.

By the time a narrative reaches consensus, the trade is usually crowded, late, or already over. The edge lies in identifying what comes next before the crowd does, and having the discipline to exit once it becomes obvious.

The real questions are second-order. Not “will oil rise?” but “which instrument captures that correctly?” Not “will the dollar surge?” but “was it already moving before anyone had a reason to explain it?”

Complexity is uncomfortable. But it is also where the edge lives.

The fog will lift. It always does. The question is whether you were thinking clearly while everyone else was following the noise.

PayPal () is now one of the most hated large-cap fintech stocks.

Growth has slowed, competition has increased, and the stock has lost most of its initial gains. Many investors now see it as a stagnant payments platform.

Consensus predicts decline and ongoing irrelevance as competitors gain market share. Yet, the core business is still profitable, cash-generating, and integral to global commerce.

The Thesis

PayPal offers asymmetric risk/reward at current prices because:

• Sentiment has shifted from excitement to frustration.

• The business is still profitable despite slower growth.

• Valuation suggests decline instead of stability.

• Technical indicators show long-term support is forming.

Sentiment

I remember using PayPal in the early 2000s. They locked my account and asked for a fax of my life story to unlock my funds. As an eBay seller, this was incredibly frustrating.

Fast forward 25 years and that same frustration is reflected in sentiment around the company today.

It remains widely known that PayPal can freeze accounts or hold funds unexpectedly. Some things never change.

Investor frustration is now just as visible. In many circles PayPal has become synonymous with disappointment, often jokingly referred to as “PainPal”.

Contrast

Back in the early 2000s, PayPal was a favorite of the internet boom.

After spinning off from eBay in 2015, sentiment was very positive. Investors viewed it as a top digital payments platform worldwide and a top growth stock.

Over the next six years, the stock rose about tenfold, from around $28 at relisting to nearly $300 at its 2021 peak. It became a core growth holding during the zero-rate era.

Then growth stalled. After 2021, the stock gave back almost all those gains. Today, PayPal trades not far above its initial valuation as an independent company.

To show how weak this performance has been, let’s compare PayPal to the Nasdaq.

Comparing PayPal to its index helps us see its performance over time against similar companies.

Exhaustion

Sentiment is now so weak that even traditional value-investing communities show little interest. Comments include:

“It’s a sinking ship.”

“I wouldn’t buy it even for 20.”

“… closer to a speculative gamble.”

Even among those still holding shares, the tone reflects fatigue:

“Bag holder… big buybacks yet to have an effect.”
“Fed up watching the money bleed.”

My rough indicator is simple: when broad investing communities are bearish, I put a stock on my watchlist. When even value-oriented investors show little interest, it deserves deeper analysis.

Technical Analysis

The stock is now trading back toward its initial valuations from 2015, providing major long-term support.

There’s bullish divergence forming on the RSI, suggesting that downward momentum is weakening as the price revisits lows.

Bullish RSI divergence often signals potential entry points during oversold conditions, especially when RSI drops below 30 and begins to rise.

Fundamentals

Despite negative sentiment, the business remains strong.

PayPal’s network is deeply embedded. It serves hundreds of millions of accounts and tens of millions of merchants globally. For many businesses, switching payment providers can be risky and complex, creating significant switching costs.

The balance sheet is healthy, with cash roughly equal to debt and solid free cash flow.

The issue is growth. Revenue expansion has slowed significantly since its high-growth years.

Part of this slowdown is strategic; management is intentionally pivoting away from low-margin volume in favor of higher-quality revenue and operational efficiency.

Valuation

PayPal now trades at about 7–8x forward earnings and under 5x EV/EBITDA, making it one of the cheapest large-cap fintech and payments companies globally.

Despite the low valuation, profitability is strong. Return on equity is around 20–25%, and return on assets is about 4–5%, both healthy for a global payments platform.

AI disruption

There’s a narrative that AI will hurt software and fintech margins through competition. This may be true for some firms. However, for financial infrastructure companies with a strong moat, the opposite might happen.

Banks, insurers, and payment networks face high back-office labor costs. Areas like compliance and fraud detection are being rapidly automated by AI. As these processes become more efficient, costs drop while transaction volumes grow.

Dividends

PayPal recently introduced its first dividend, with an initial yield of about 1–2%. This marks a shift toward a more mature capital return profile.

Even a modest payout can help reposition the company as a value stock, attracting investors focused on yield rather than just growth.

Share Repurchases

Management plans to buy back ~$6B in shares in FY2026. At current valuations, these buybacks will retire enough stock to increase each remaining shareholder’s ownership by about 16.5% over the next year. Without spending a single cent, investors are effectively 'growing' their stake in PayPal's future earnings simply because the company is retiring shares at such an aggressive discount.

Risks

The main risk is that PayPal becomes a value trap. The investment case relies less on rapid growth and more on stability. If revenue and earnings decline, even a low valuation may not offer protection.

A 7–8x earnings multiple can look cheap, but declining businesses often remain cheap for long periods.

The opportunity is if the business stabilizes (or grows) rather than shrinks.

At current valuations, even modest growth or steady cash generation could justify higher prices over time.

This setup is not risk-free, but the opportunity becomes appealing if one believes stability is likely rather than decline.

Conclusion

PayPal is no longer priced as a growth company. It’s valued as a business in decline.

Yet the company remains profitable, cash-generating, and integral to global commerce. Sentiment is low, expectations are muted, and valuation reflects stagnation rather than stability.

If the business merely stabilizes, the current setup offers asymmetric risk/reward. In markets, the best opportunities often arise when a company is overlooked or dismissed.

Bitcoin has fallen a gut-wrenching ~50% from its prior high near $126k to around $60k.

For long-time holders, this isn’t unusual. During the last bull market, Bitcoin experienced multiple drawdowns greater than 30%. Full bear markets have involved declines closer to 80%.

This raises the obvious question: Is this the start of a prolonged bear market, or a sharp drawdown within an ongoing bull market?

This article explores the current Bitcoin drawdown through a framework combining human behaviour, ownership, supply structure, and macro conditions.

Current Setup (Summary)

Core premise: Bitcoin offers asymmetric risk/reward at $60k because:

• Sentiment has collapsed into ridicule

• Ownership remains light among large capital pools

• Supply is inelastic and cannot respond to price

• Macro conditions are becoming more favourable

None of these guarantee than $60k is the bottom. But together, they define an environment where downside risk is lower and upside potential increases.

Let’s walk through each.

1) Sentiment: Contempt Is a Late-Stage Signal

When everyone loves an asset, it is usually already expensive. When an asset is widely hated but has favourable structural conditions, it is usually cheap, and that is where the opportunity is.

Extreme fear, not curiosity

Headline sentiment is deeply negative. The CoinMarketCap Fear & Greed Index has returned to ‘5’, which is defined as extreme fear. Extreme fear coincides with better forward returns when underlying utility remains intact.

The mainstream tone

During bull markets, the media often cheers:

Near major tops, coverage becomes optimistic, fuelling greed and FOMO. A good example would be this NYT article from the peak of the 2017/2018 bull market posted almost precisely at the peak, just before a drop of 85% in the price and a bear market.

Near bottoms, the tone shifts toward mockery and dismissal. Let me take you back to Ulrich Bindseil and Jürgen Schaaf’s “Bitcoin’s Last Stand” article, which argued that Bitcoin would become largely irrelevant.

The piece was published almost exactly at the lows of the last bear market, with Bitcoin trading near $15k, shortly before its 740% increase to ~$126k.

We’re beginning to see sentiment from prominent economists again: language that has historically appeared closer to bottoms than tops:

Elsewhere, coverage remains cautious of Bitcoin. A recent BBC article has begun suggesting a downside targets around $38k… another ~37% drop from here, despite Bitcoin already being down roughly 50%.

When the media calls for stark price increases or decreases after an asset has already surged or dropped precipitously, it is often an indicator that the move is nearly exhausted.

Comment sections: from curiosity to contempt

Comment sections on news articles, forums and social media are an underrated sentiment indicator

When an asset is popular, discussion tends to be curious, exploratory, or optimistic.

When sentiment turns negative, it becomes hostile or dismissive.

In mainstream investing communities like r/investing, the dominant view is that Bitcoin has no fundamentals at all: no earnings, no balance sheet.

The recurring phrases are remarkably consistent: “greater fool asset,” “pure speculation,” “no intrinsic value,” “just a number in a database,” plus comparisons to tulips or Beanie Babies.

(Recent example thread: https://www.reddit.com/r/investing/comments/1qv4l07/fundamentals_of_bitcoin_tom_lee/)

The signal here is contempt. Historically, in financial discussions contempt tends to emerge later in drawdowns.

The “no-coiner” with strong opinions

One of the most reliable sentiment tells is the person who:

• does not own Bitcoin, or owns very little

• does not understand it deeply

• but expresses high confidence about it

This cohort is often narrative-driven, and is a good proxy for how the general public feels or thinks about Bitcoin.

I would recommend not drawing conclusions from single conversations, but instead speaking with a handful of individuals in this group and asking non-biased questions to get a clearer read. This takes skill and practice. Like a good researcher, thoughtful questions will help you uncover and identify common themes.

In my own conversations, I am noticing a move from skepticism to disdain, with discussion clustering around a small set of themes:

• Bitcoin’s political association with Trump, often viewed negatively

• Energy “waste” narratives

• Claims of a lack of real-world use cases

When conversations shift toward disdain, it often signals a bottom, or close to it.

This is not to criticize the public, but human nature tends to feel strongly negative near bottoms and strongly positive near tops. The reason for focusing on those who know little about Bitcoin yet hold strong opinions is that their views tend to reflect this emotional cycle.

Those who are deeply experienced and have lived through multiple cycles often hold more contrarian views.

Key takeaway

I am more comfortable adding to my BTC holdings when public sentiment is heavily negative and yet fundamentals remain in tact. This is because negativity creates room for repricing as disbelief gradually converts into allocation, assuming ownership and structural conditions support that shift. That is what we will examine next.

2) Ownership

When ownership is light and position sizes are small, selling pressure tends to be more easily exhausted. At the same time, there are more potential buyers left to show up when conditions turn supportive.

Retail: lots of owners, small positions

Crypto ownership is already mainstream at the retail level.

In the U.S., roughly 14–17% of adults own cryptocurrency, and ownership is heavily skewed toward Bitcoin: ~77% of U.S. crypto holders own BTC. Yet position sizes are small. Around 80% of crypto investors have less than $10,000 invested.

About 6.8% of the global population own cryptocurrency. Within that group, Bitcoin again dominates: CoinShares estimates ~467 million Bitcoin owners globally.

Many hands, but small allocations.

Whales: accumulating into weakness

Large holders are buying into the drawdown. On-chain data from Glassnode shows that wallets holding 1,000 BTC or more have increased during recent periods of weakness. As price falls, whale ownership rises.

This shows that deep-pocketed participants are leaning into downside. These are the signals you want to watch for around bottoms.

Institutions: from “should we buy?” to “how much?”

Institutional allocation remains low. A Bank of America fund manager survey summary found 67% of managers at zero crypto allocation.

What’s changed isn’t the size of allocations: it’s the conversation. In December 2025, Reuters reported that Bank of America would allow its wealth advisors, including Merrill, to recommend crypto to clients. Suggested allocations were in the range of ~1–4% for investors who can tolerate volatility.

Crypto is becoming less of a “yes-or-no” question. It’s increasingly a portfolio sizing question.

Ownership takeaway

Put together:

• Retail ownership is broad, but position sizes are small, limiting forced selling while leaving room for current owners to increase exposure

• Whales are accumulating into price weakness, a pattern seen as selling pressure becomes exhausted

• Institutional exposure is low, but the stance has shifted from dismissal to starting to take small positions

When ownership is light and most positions are small, there are fewer people left who need to sell. At the same time, there are many people who still haven’t bought much yet, so there is more room for new buyers to enter later.

The biggest new demand during the next bull market is likely to come from large investors moving from zero exposure to small positions, and from small positions to slightly larger ones.

Retail investors are likely to follow once prices stabilise and the narrative improves. Given that many already own some Bitcoin, they will likely have a greater propensity to increase their position size once we get confirmation of an uptrend, further fueling the move.

3. Supply and Demand

Supply and demand explain why price moves so violently in up or downtrends.

Supply: no response to price

Bitcoin’s supply is different from almost every other asset.

With commodities, higher prices bring on new supply. Bitcoin has no such mechanism.

Its monetary policy is fixed. Total supply is capped at 21 million coins, and issuance declines over time through predetermined halvings.

Higher prices do not incentivise greater production or faster issuance.

As a result, Bitcoin’s price is driven almost entirely by changes in demand.

Demand: why Bitcoin exists

Bitcoin is censorship-resistant, confiscation-resistant, and sovereign by design. It is public digital infrastructure for transferring value without relying on banks, payment networks, or trusted intermediaries.

The ledger is not owned or controlled by any single entity. Anyone with an internet connection can receive value without permission, creditworthiness, or institutional access.

Traditional financial systems increasingly rely on concentrated intermediaries with clear choke points. Bitcoin removes those choke points.

Bitcoin does not need universal adoption to justify its role. It only needs to remain a credible, censorship-resistant alternative settlement layer for global capital. As long as portability, neutrality, and sovereignty matter, there is a persistent base level of demand, which can be amplified by human emotion and FOMO as prices rise.

How low can it go?

Bitcoin has seen 30–50% drawdowns within bull markets, while full bear markets have typically involved 70–80% peak-to-trough declines. From the $126k high, both remain possible.

But based on the indicators we’ve discussed already, I think we’re much closer to a bottom at $60k than many people think:

• Sentiment has moved beyond fear into ridicule.

• Ownership remains light, especially among institutions, while larger holders appear to be buying into weakness rather than selling.

Additionally:

1. Price is now trading in a zone where prior cycle lows have often formed

2. The previous cycle high has historically acted as support.

3. Momentum indicators such as RSI are also at levels that have previously marked market bottoms or bottoming ranges.

Taken together: sentiment exhaustion, light ownership, accumulation by larger players, and technical compression, we are close to the area where a durable bottom is more likely to form than not.

Remember: Markets rarely feel safe at the bottom. By the time they do, much of the move is already gone. The goal near lows isn’t to buy the exact bottom. It’s to avoid waiting so long that the opportunity has already passed.

Energy is one of the most hated asset classes. ESG mandates have pushed capital away from oil, gas, nuclear, and coal. Consensus expects a decrease in usage as renewables take over, though fundamentals point to rising demand.

The Thesis

Oil, gas, coal, and nuclear equities offer asymmetric risk/reward because:

1. Fossil Fuel usage has increased despite decades of transition spending.

2. Energy sources like oil, gas, and coal are more necessary than assumed, and nuclear will become increasingly critical

3. Power demand is accelerating from AI/data centres faster than new generation can be built

4. Underinvestment in nuclear across the U.S. and Europe extends the timeline over which fossil fuels remain dominant

5. Valuations remain depressed despite improving fundamentals

Fossil Fuel Usage Has Increased

In the last fifty years, humanity has spent six to eleven trillion dollars trying to replace fossil fuels. Most of this effort focused on wind and solar energy.

Even with this investment, fossil fuels still make up about 81 percent of global energy. This is only a slight drop from 83 percent. A two percent change in forty-five years.

As money went into renewables, investment in oil, gas, and nuclear stalled. Still, demand for these energy sources kept rising.

Energy is More Necessary than Assumed

Almost everything that isn’t a rock, plant, or metal requires energy to make. Life expectancy links closely with access to energy.

There is a clear relationship between a country’s GDP per capita and its energy usage per capita.

If billions want better lives, global energy use will need to rise, not fall.

Even the International Energy Agency, known for its early decarbonization forecasts of 2030, has adjusted its peak oil demand timeline. It now suggests demand could peak in the 2060s, reflecting the reality of rising global energy needs.

Efforts to reduce fossil fuels and CO₂ emissions with wind and solar have good intentions. However, replacing fossil fuels with renewables hasn’t worked as planned.

• Steel builds bridges, trains, hospitals, and wind turbines.

• Cement supports homes, roads, and water systems.

• Fertilizer feeds billions.

• Medicines require energy-heavy processes.

• Cities need heat, light, and functioning supply chains constantly.

Wind and solar produce power only when conditions allow. They can’t provide power on demand for these needs.

Power Demand Is Accelerating Faster Than Supply Can Respond

At the same time, demand is accelerating.

In many U.S. areas, connecting a data center to the grid takes five to seven years. On-site power can cut that time to under two years.

As a result, about one-third of planned data center capacity is now set to generate its own power. A year ago, nearly none did.

Most of these projects rely on natural gas for steady power. About seventy percent plan to use it as their main source because it’s available, dispatchable, and reliable.

However, on-site power is often less efficient and more carbon-intensive than power from a shared grid that includes nuclear, hydro, and other lower-carbon sources.

Underinvestment in Nuclear Extends Fossil Fuel Dependence

Nuclear is the only scalable, dispatchable, low-carbon power source capable of replacing fossil fuels at industrial scale. Currently, no large traditional nuclear reactors are under construction in the U.S., and new projects typically require 10–15 years from approval to operation.

Germany shut down its nuclear plants in 2023, yet fossil fuels still make up over 75 percent of its energy use.

In 2024, oil became the largest share of primary energy consumption, followed by gas and coal. Renewables covered less than a third of total energy use.

Electricity prices are now structurally higher in Germany. Estimates suggest German power prices are about twenty to twenty-five percent higher than they would have been if nuclear power had remained.

The nuclear phase-out coincided with a prolonged recession from 2023 to 2025.

In 2026, Chancellor Friedrich Merz called the nuclear exit a “serious strategic mistake,” acknowledging that reliable capacity was lost before a workable alternative was ready.

When nuclear capacity is removed or underbuilt before scalable alternatives are ready, fossil fuel usage does not disappear. It extends.

What This Means for Investors

FMS Investors are the most underweight energy among equity sectors. Because energy is under-owned, the tailwinds outlined earlier can lead to significant price moves.

Oil: Hated, Still Essential

Oil faces criticism, yet global demand keeps rising, creating an opportunity for investors.

Oil supports food production, agriculture, mining, construction, shipping, aviation, medical supplies, and petrochemicals. There are no scalable substitutes for many of these uses.

Industry estimates suggest oil and gas underspend by about one to two billion dollars per day while relying on infrastructure built years ago.

At around $60 per barrel, global production becomes unsustainable. This price is where new drilling, decline replacement, and future development barely meet today’s costs.

The U.S. shale industry has drilled most of its best acreage, meaning replacement barrels are now lower quality, more capital-intensive, and more price-sensitive.

Over time, costs will rise as depletion forces production into tougher reservoirs, while expenses increase due to labor, steel, services, financing, and regulations.

As the cheapest barrels run out, the marginal barrel gets pricier. The longer investment remains limited, the higher prices must get to stabilize supply.

Unless a global recession or lasting geopolitical peace restores large supply volumes, oil prices must eventually rise to encourage the investment needed to maintain production.

Broad energy ETFs like IUES are starting to reflect this supply-demand imbalance, breaking through key support and resistance levels. Sentiment is still negative, but there’s clear potential for growth.

Oil services stocks, which usually lag behind oil prices, remain well below previous peaks due to a decade of capex destruction. They are starting to break above key resistance levels set during the 2019 bear market.

For investors, this creates a familiar setup: an essential asset that is under-owned, unpopular, and capital-starved, yet still needed by the real economy.

Natural Gas: The Bridge We Pretend Doesn’t Exist

Natural gas is vital for winter heating, peaking power, and keeping the grid stable when wind and solar output declines. Natural gas futures rose from 1.24/MMBtu to 3.2/MMBtu from 2024-2025.

Electricity demand changes by season and time of day, creating gaps that intermittent sources can’t fill. Gas covers these peaks and prevents system failures.

The rapid growth of AI infrastructure and electrification widens this gap. While nuclear is likely the long-term solution for reliable, low-carbon baseload power, new capacity will take at least a decade to ramp up. For now, natural gas is unavoidable.

Gas is also a key industrial input. It underpins nitrogen-based fertilizers and petrochemicals, essential for large-scale food production, preservation, and supply chains.

Nuclear: The Longer-Term Answer

Nuclear power is the only scalable source of clean, dispatchable energy that can meet rising demand when solar and wind aren’t available.

It generates large amounts of electricity continuously, with near-zero operational emissions and a small physical footprint.

Unlike wind and solar, it doesn’t depend on weather and can support dense cities, heavy industry, and data-heavy economies.

However, nuclear isn’t a near-term solution.

Currently, no large traditional nuclear reactors are under construction in the U.S., and new projects typically require 10–15 years from approval to operation. Decades of political resistance, regulatory hurdles, and capital aversion have left the build pipeline thin.

The result is a timing mismatch: nuclear is necessary, but it cannot close today’s supply gap.

Public perception is beginning to shift. Policymakers across Europe and North America have softened prior opposition. Several countries have delayed plant closures, and small modular reactor (SMR) initiatives are gaining political backing. Technology companies have also begun exploring direct nuclear partnerships to secure long-term power supply.

Markets have noticed.

The uranium complex has already repriced meaningfully higher. Vehicles such as the Sprott Physical Uranium Trust experienced significant appreciation between 2019 and 2025 as sentiment improved. Some of the “easy money” that comes from deep pessimism has likely already been captured.

This timing matters for investors. Oil, gas, and coal benefit first because they are the only scalable sources ready to meet today’s demand. Nuclear’s opportunity unfolds over a longer horizon. As reliability becomes increasingly valuable, nuclear capacity is likely to expand, but the build timelines ensure fossil fuels remain essential in the interim.

Coal: The Option Nobody Wants

Coal is perhaps the most disliked fuel in the energy system. Many investors assume its decline is linear and irreversible.

In reality, coal usage has proven cyclical and economically sensitive. It responds less to sentiment and more to price and industrial necessity.

There are two distinct coal markets with different demand drivers:

Thermal coal

Thermal coal is used for electricity generation and competes directly with natural gas.

Utilities switch between the two based on economics. When natural gas is cheap, gas dominates. When gas prices rise above key cost thresholds, coal regains market share.

Metallurgical coal

Metallurgical coal is used in steelmaking and is driven by industrial demand rather than fuel economics.

Roughly 70% of global steel is still produced using the blast furnace process, which requires metallurgical coal. At industrial scale and temperature, there is no commercially viable substitute. Each tonne of blast furnace steel requires significant volumes of met coal to function as both fuel and reducing agent.

When the VanEck Steel ETF (SLX) rallies, it’s telling you:

• Global industrial activity is recovering

• Infrastructure spending is accelerating

• BF utilization rates are rising

• Met coal demand is increasing

The transmission mechanism: SLX tends to lead met coal equities by 1-3 months. If SLX rallies while HCC/AMR lag, that’s a catch-up opportunity.

Conclusion

Energy markets are understood by separating politics from physical reality.

Energy remains structurally under-owned in global portfolios, despite being essential to the economy for the foreseeable future. Years of ESG pressure and policy uncertainty have slowed investment and limited supply growth. When ownership is this low, even small changes can lead to significant price shifts.

Sentiment reinforces this opportunity: Oil, gas, and coal are hated and often viewed as sunset industries, priced as if demand is on the verge of collapse.

Yet demand keeps growing, driven by population growth, electrification, data infrastructure, and industrial activity. The gap between perception and reality matters because markets ultimately adjust when narratives don’t match outcomes.

Timing matters.

• Oil and gas appear positioned for a structural bull market over the coming decade. They are the only scalable sources capable of meeting today’s demand.

• Coal is different. It is not a secular growth story, but a cyclical trade. It benefits when natural gas tightens or steel production strengthens, acting as the system’s marginal stabilizer.

• Nuclear represents the longer-term solution. It is structurally bullish over the coming years as reliability becomes more valuable, but parts of the uranium complex have already repriced optimism. Its timeline is measured in decades, not quarters.

Everywhere you look, something made of metal is moving.

This isn’t a fad either. Since the turn of the millennium, gold has materially outperformed the S&P 500. A “pet rock” has beaten the world’s most celebrated equity index.

So what’s going on? What’s pushing metals higher, what does this tell us about investor behaviour, and can history help frame how far this move can run?

The background conditions behind the move

Ownership: empty space above the price

Metals remain marginal in most portfolios. The ETF data makes this clear: gold’s share of total ETF assets is still near cycle lows and far below prior peaks.

What about retirement capital? NEST, the UK’s largest auto-enrolment pension scheme with over 13 million members. In its default Retirement Date Funds, you will find global equities, bonds, and property. What you will not find is a dedicated allocation to metals. No gold exposure. No mining allocation.

Take sovereign wealth funds. The Norway Government Pension Fund Global, one of the largest pools of capital, has a ~3% allocation to gold and metals miners.

Look across institutions and the picture is consistent. Most large portfolios run zero to low single-digit exposure to metals. Where commodities exposure exists, energy tends to dominate and what remains for metals is slim.

Because metals are structurally under-owned, catalysts create parabolic moves.

Sentiment: Disbelief as fuel

A few years ago, metals were subject to ridicule.

Gold was for doomers and owning metal marked you out as someone who had given up on the system.

This kind of sentiment is important because it creates room for price to run. When an asset is widely dismissed, the sceptics can become future buyers if conditions change.

Well, as of the middle of 2025, those conditions are changing. Google Trends shows a rise in searches for “Buy Gold,” suggesting broader awareness is building.

Anecdotally, I’m seeing changes on the ground too. Here in Portugal, signs offering to buy and sell gold have started appearing in public places. A late-cycle signal that appeared in previous gold bull markets.

In October 2025, reports described thousands queuing daily in Sydney to buy gold. Many buyers were there simply because they had read about gold in the news.

Google Trends, sign-posts, and queues are treated as unsophisticated signals, but they’re informative when layered. History suggests that they appear later in a move.

Catalysts

We’ve discussed the background conditions that create room for prices to move. But conditions alone don’t drive sustained rallies. What turns a setup into action is a catalyst colliding with real supply and demand constraints. That’s where we turn next.

Weaponisation of Money: The Spark

Ownership and shifting sentiment create the space and fuel for a rally. What turns that setup into price action is a catalyst, alongside supply and demand.

Over the past few years, money has become a weapon of war.

The invasion of Ukraine was the most obvious example of this. Sanctions were rolled out at speed: Russian assets were frozen and banks were cut off. At the time, many celebrated what looked like the instant destruction of the Russian economy.

The second- and third-order effects were not discussed.

When countries use sanctions, they make access to the system conditional. They’re saying “your money works only as long as you follow our rules”.

Countries that fear being sanctioned do not want their savings sitting inside someone else’s system with fluctuating rules. They start looking for places that sit outside the system.

We see this on smaller scales too: Individuals are de-banked for not following the rules of the system are forced to rely on money that sits beyond reach, whether that is physical cash, gold, or bitcoin.

At the state level, the response has been clear: Russia increased its gold holdings under sanctions pressure. Other countries followed.

When money becomes conditional, neutrality matters. Metals are neutral.

Debasement: The pressure cooker

Governments fund themselves by printing money.

Of course, they don’t tell you that! They call it stimulus, easing, or something like that. While the names may differ, the result is the same: Over time, dollar, euro, pound, or yen that you hold in your wallet buys less than it used to.

This is obvious, you see it over time when visiting the shops: The price of goods and services rises year after year.

That pressure doesn’t stop at groceries either. It applies to everything priced in currency. Yes, including metals.

For decades, bonds were supposed to protect you from this, but they don’t anymore. Yes, you earn interest holding government debt, but you’re being paid back in lower value currency units and over time your purchasing power is going down.

This is where metals fit. Unlike fiat currency, they are:

• Not printable

• Not dependent on policy credibility

• No one else’s liability

• Not cancellable

As long as currencies are being debased - a structural feature of how governments fund themselves - scarce assets with real-world demand tend to exert a gravitational pull higher over time.

Demand Accelerator: The AI trade is a metals trade

Most people are long the Mag Seven, whether they know it or not. Passive money flows through index funds, pensions, and savings plans.

What very few people are long is what those companies are buying.

The AI trade is often framed as a software or subscription story. In reality, it is increasingly a physical one. The largest technology firms are converting financial assets into infrastructure: data centres, power generation, cooling systems, and hardware.

That infrastructure is metal-intensive:

• Copper (power, wiring, transformers)

• Aluminium (cooling, structures)

• Silver (conductivity)

• Uranium (grid stress, baseload power)

• Steel and specialty metals

AI is a powerful source of demand, but it is not the only one.

These same metals are also critical inputs for energy infrastructure, electrification, defence, transport, and industrial manufacturing.

In other words, AI adds pressure to markets that were already tight.

Price-inelastic supply: the absence of a brake

In many markets, the cure for high prices is high prices. Rising prices attract supply, and supply eventually cools the move.

Across the metals complex, supply is constrained by geology, bureaucracy, and time. New supply can take years to arrive, regardless of price.

Copper is a good example. From discovery to first production, a new copper mine typically takes 10–20 years.

Other metals show rigidity too:

• Silver: ~70% of global silver supply is produced as a by-product of copper, lead, zinc, or gold. You don’t mine more silver unless you mine more of something else.

• Platinum group metals: ~75% of global platinum supply comes from South Africa. Production is concentrated in a handful labour-intensive mines with high political and operational risk.

• Nickel: Around 40% of global supply now comes from Indonesia, much of it policy-dependent and tied to laterite processing that is capital-intensive and environmentally constrained.

• Tin: Supply is extremely concentrated. Roughly 50% of global output comes from just three countries. A single mine in the DRC accounts for a high single-digit percentage of world supply.

• Aluminium: Over 60% of production costs are electricity. Smelting capacity depends on cheap, stable power and multi-year buildouts.

• Gold: Average ore grades have been declining for decades. Higher prices often offset rising costs rather than unlock meaningful new volume.

When demand begins to hit this scarcity, and the conditions outlined above are in place, prices tend to move sharply higher.

Where Are We in the Cycle?

Structurally, the forces pushing metals higher have not gone away:

• Supply and demand imbalances remain

• Physical constraints are still real

• Debasement remains a feature of the system

• Geopolitics continues to push capital toward neutral, hard assets

What has changed is positioning and mood. Ownership is beginning to rise from very low levels, and sentiment has shifted from ridicule to curiosity, and now toward optimism. As that transition unfolds, the easy upside has gone.

This is what mid-cycle excess tends to look like.

In past metals bull markets, the strongest advances were interrupted by sharp 30–40% pullbacks. They reset ownership and sentiment, which created the conditions for the next leg higher.

That is where we likely are now: not at the end, but no longer early either.

Conclusion

The metals complex looks tactically overvalued, given the magnitude of the recent moves, sentiment turning optimistic, and ownership increasing. The metal markets look ripe for a correction, even while the structural trend remains bullish.

A reminder that pullbacks in the last metals bull market were deep and often ran for multiple years.

While the market appears tactically stretched, over the next decade the conditions that have driven the bull run so far show no signs of slowing:

• Money will continue to be debased

• Debt will keep growing

• Money will continue to be weaponised as a policy tool

• Supply and demand constraints will matter

• Neutral, non-liability assets will retain a role in portfolios

That alone does not guarantee prices move steadily higher. If history is any guide, this cycle will include gut-wrenching 30–40% drawdowns. We haven’t had those yet.

Are you ready? Are you sure?

Structurally, the case remains in place for the next decade.

On one side, you have the “Strategy is a Ponzi” sceptics.

On the other side, the “Strategy is a new paradigm” believers.

Both sides think they’re arguing about Strategy.

In this article I outline why that fight is part of the Strategy.

The Strategy playbook

Strategy began in 1989 selling data software. The software made money and cash grow on the balance sheet.

In 2000, the stock surged with the dot-com bubble. When the bubble burst and things settled, returns from roughly 2004 to 2020 stayed weak.

During those years, cash kept building and that became a problem as the cash earned little interest. It sat there and lost purchasing power.

The CEO Michael Saylor saw that the operating business worked, but the treasury was a melting ice cube and the flat stock price told the story.

So in 2020, Strategy made a move and used some of its cash to buy 21,000 Bitcoin.

Bitcoin rose → MSTR rose → Conviction in Bitcoin grew.

Then came the 2022–2024 crypto winter. Prices fell hard and Strategy bought more. After Bitcoin recovered, the Bitcoin balance sheet became the business.

As of December 2025, Strategy held about 671,268 Bitcoin, over 3% of total supply.

The software business still makes money, but most of Strategy’s value now comes from unrealised gains on Bitcoin.

The thesis is simple: Those unrealised gains must outrun balance-sheet liabilities before markets lose patience.

So far, they have. Fiat keeps losing buying power as Bitcoin has gained it. If that gap holds long enough, Strategy survives.

What Are They Doing With All That Bitcoin?

Strategy uses the unrealised gains on its Bitcoin as collateral. With their preferred shares, they turn Bitcoin’s volatility into financial products.

These trade under tickers like STRC, STRF, STRD, and STRK. Readers who want the mechanics can find them in Strategy’s investor materials.

Each product pulls a different risk out of the same underlying Bitcoin and hands it to a different buyer.

Instead of experiencing all Bitcoin’s ups and downs, investors can buy a preferred that provides steady income. They earn regular dividends and avoid the biggest swings in either direction.

Strategy keeps the long-term exposure. Investors trade volatility for income.

The Star of the Show: STRC

Stretch (STRC) has been the standout success.

It raised ~$2.5 billion and became the largest US IPO of 2025.

The appeal is simple. It pays a variable yield around 10 to 11 percent a year, paid monthly, and it aims to trade near $100.

Park $100,000 and you collect roughly $850 to $900 a month before tax, depending on price and rate.

If STRC trades below par, Strategy raises the dividend. If it trades above par, Strategy issues more shares.

That push-pull helps keep the price close to target, even though it can drift.

Dividends come from a multi-billion dollar cash reserve and new preferred-share issuance. Which brings us to the real engine.

The Confidence Flywheel

STRC and the other preferreds run on a loop:

• Strategy sells shares into the market

• It uses the cash to pay dividends

• Dividends support the price

• A steady price keeps capital markets open

• Open markets allow more issuance

Round it goes.

Bitcoin sits behind the structure as long-term collateral. But Bitcoin does not fund dividends, at least not yet. Capital does.

And capital shows up only while confidence holds.

This is where the whole structure lives or dies.

When capital is easy, the flywheel spins. When access tightens, it slows. If any part falters, pressure can build fast. You would see it first in the preferreds trading well below par.

In an extreme case, Strategy could sell Bitcoin to fund dividends. That would shake confidence, spook the market, and jam the flywheel even harder.

Confidence, Cult, and Polarisation

Any structure dependent on repeated capital access needs conviction.

And conviction peaks in conflict.

If you’ve lived through more than one Bitcoin cycle, you know the pattern. Years of ridicule. Bitcoin obituaries. None of it weakens belief. It sharpens it.

The same dynamic plays out here.

Enter Michael Saylor.

Saylor talks about bitcoin like a force of nature:

#Bitcoin is a swarm of cyber hornets serving the goddess of wisdom, feeding on the fire of truth, exponentially growing ever smarter, faster, and stronger behind a wall of encrypted energy.

Add his AI-generated Twitter posts. Saylor in the Matrix. Saylor on rockets and sinking ships. Likes and retweets flood in and outrage follows.

Skeptics see obvious fraud. Believers see proof you don’t get it.

Each side hardens the other.

This polarisation manufactures conviction at scale.

And conviction keeps the flywheel turning.

Real Risks, Real Opportunities

Between the skeptics and believers sit the real risks and opportunities:

Price
STRC gravitates toward $100, but it does not live there. It has traded into the low $90s. Sell at the wrong time and you lock in a loss. Buy during those dips, and the effective yield rises. And if the price trades back to par you also get the benefit of capital gains.

Dividend
Dividends are variable. Strategy raises them to defend price. It can cut them too, and that flexibility is part of what allows the structure to adapt to market conditions.

Currency
Payments arrive in dollars. The dollar has a perfect record of losing purchasing power, which is part of why the yield is relative high to begin with.

Timing
Even if Bitcoin wins over decades, the path matters. Long drawdowns or stagnant pricing can result in tight capital markets that strain the flywheel.

Bitcoin
Everything rests on Bitcoin beating Strategy’s fiat liabilities over time. If it does, the structure holds, and you get compensated for taking the risk.

Closing Thought

At the start, I said the fight between the skeptics and believers is the Strategy.

Reading this, reacting to it, trading it, ignoring it. All of it feeds the same flywheel.

It is in understanding that this fight is the trade and deciding whether you want to live inside it.