Kevin Warsh‘s nomination as the Fed Chair pick by President Donald Trump has sent precious metals into a tailspin, potentially unlocking a massive wave of liquidity for the equity markets.

End Of ‘Vortex’ Trade

The vertical ascent of gold and silver came to a screeching halt on Feb. 2, as the nomination of Warsh as Fed Chair triggered a violent reversal in commodity markets.

Tom Lee, Head of Research at Fundstrat, told CNBC that the previous rally was a “juggernaut trade” that had become a “vortex sucking risk appetite” away from the broader stock market.

As silver and gold plunged, Lee argued that this “bloodbath” is actually a “pause that might refresh” the broader bull market, releasing trapped capital back into risk assets.

A ‘Responsible’ Fed And The Tech Rotation

This perceived end to currency debasement fears has effectively turned off the red light for tech investors.

With the dollar jumping, the fundamental “reason to hide” in metals has evaporated, providing what many see as a green light for the Mag 7 and the burgeoning AI sector to lead the next leg of the rally.

Focus On Earnings Over Sideshows

While commodity traders fret over the “parabolic” moves down, Jim Cramer urged investors to ignore the volatility. “Maybe we should just worry about earnings,” Cramer noted, dismissing the metals movement as a secondary event.

He emphasized that while sudden price movements are startling, they are often “sideshows” compared to the “meat and potatoes” of corporate profitability.

With the S&P 500 eyeing the 8,000 mark, the consensus among the experts is clear: the metals crash is not a sign of economic doom, but a necessary reset that clears the path for a historic run in tech and cyclical stocks through the remainder of 2026.

Gold, Silver Tumble

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Photo courtesy: Shutterstock