Market Enters 'Risk-Off' Mode As Analyst Predicts This Signal Flashing Warnings Similar To 2020, 2008 Crisis

The U.S. stock market is exhibiting a “risk-off” sentiment as the gold-to-silver ratio triggers a warning signal reminiscent of the 2020 and 2008 crises, according to analysis from Bravos Research.

What Happened: In an X thread, the firm highlighted a recent breakout in the gold-to-silver ratio, a metric closely watched to gauge market risk appetite. This signal indicates that traders are increasingly favoring the safe-haven asset gold over the more volatile silver.

The ratio stood at 99.59 as of Tuesday, 3:05 a.m. ET. This ratio represents the number of ounces of silver that are equivalent in value to one ounce of gold.

Bravos Research points out that similar breakouts in the gold-to-silver ratio preceded significant market downturns, including the 2022 bear market, the 2020 COVID-19 crash, and the 2008 Great Financial Crisis.

The current breakout, following a period of consolidation since 2022, suggests a potential shift towards greater market instability and a move away from riskier assets.

15/ This is what the gold-to-silver ratio looks like since 2020

It just broke out above a major basing pattern that had been forming since 2022

This is a risk-off signal, showing traders are moving away from the more volatile silver and into gold pic.twitter.com/YlcE5Q0oVm
— Bravos Research (@bravosresearch) April 7, 2025

Why It Matters: The analysis also notes that the current market sell-off, characterized by declining bond yields alongside falling stock prices, mirrors the growth-driven downturn seen in 2020. Such sell-offs, while not always leading to recession, tend to be sharp and volatile.

7/ As you can see, bond yields have been declining alongside the stock market during this correction

That tells us financial markets are currently more concerned about slowing growth, due to Trump's tariffs

That's very different from 2022, when yields were rising as inflation… pic.twitter.com/pnrzAIgr4w
— Bravos Research (@bravosresearch) April 7, 2025

The CBOE Volatility Index has spiked 118% over the last three sessions, marking its fifth-largest three-day spike. It has also closed above the 45+ level first the first time since the pandemic and the Global Financial Crisis.

Despite the recent spike in the VIX volatility index indicating growing market fear, Bravos Research suggests this period of panic could eventually present significant long-term buying opportunities for quality assets.

While acknowledging the potential impact of President Donald Trump‘s tariffs on triggering a recession, the firm advises against aggressive short positions and recommends scanning for discounted investment opportunities.

Price Action: Stocks fluctuated Monday on conflicting tariff delay reports, ultimately closing mixed. By Tuesday, major indices were significantly down from recent highs: the S&P 500 was 17.65% lower, Nasdaq 100 was down 21.56%, and Dow Jones declined 15.77%, following a week of tariff-driven selloffs.

The SPDR S&P 500 ETF Trust SPY and Invesco QQQ Trust ETF QQQ, which track the S&P 500 index and Nasdaq 100 index, respectively, were mixed on Monday. The SPY was down 0.18% to $504.38, while the QQQ advanced 0.24% to $423.69, according to Benzinga Pro data.

Gold Spot US Dollar declined 0.94% to hover around $3,008.74 per ounce. Its fresh record high stood at $3,168.04 per ounce. Silver, on the other hand, was up 2.39% to $30.2375 per ounce.

On Tuesday, the futures of Dow Jones were up 1.75%, whereas the S&P 500 and Nasdaq 100 indices rose 1.42% and 1.36%, respectively.

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