Seabridge Gold Plummets 13% Amid Sector-Wide Precious Metals Selloff – Is This a Buying Opportunity?

Summary
• Seabridge Gold (SA) trades at $29.06, down 13.36% intraday after hitting a low of $28.13
• Analysts maintain a $48.50 average price target, implying 56% upside from current levels
• Gold sector ETFs like GDXJ (-12.1%) and GDX (-11.5%) mirror SA’s sharp decline
• Trump’s Warsh Fed chair nomination triggered a sector-wide selloff in precious metals

Seabridge Gold’s 13% intraday plunge aligns with a broader collapse in gold and silver prices, driven by Trump’s nomination of Kevin Warsh as Fed chair. The move has rattled investors betting on precious metals as a hedge against dollar weakness, with SA’s 52-week low of $9.40 now 18% away. Analysts remain bullish on long-term potential, but short-term volatility remains acute.

Trump's Warsh Nomination Sparks Sector-Wide Precious Metals Selloff
The 13.36% drop in Seabridge Gold’s stock price follows a sector-wide collapse in precious metals triggered by President Trump’s nomination of Kevin Warsh as the next Federal Reserve chair. Warsh’s hawkish reputation eased concerns about the Fed’s independence, causing the dollar to surge and undermining gold’s appeal as a hedge. Gold futures fell 10% to $4,750/oz, while silver tumbled 30%. SA’s decline mirrors this trend, with its price now 18% below its 52-week high of $37.99. The move reflects forced selling by leveraged traders and a reevaluation of the dollar’s role as global reserve currency.

Gold Sector Reels as GOLD Tumbles 3.46% – Seabridge Gold Follows the Lead
The gold sector leader GOLD (-3.46%) and leveraged ETFs like SLJY (-13.9%) and SILJ (-13.4%) have mirrored Seabridge Gold’s sharp decline. Junior miners GDXJ (-12.1%) and GDX (-11.5%) also fell in lockstep, confirming the sector-wide selloff. SA’s 13.36% drop is proportionally in line with the sector’s average 11-12% decline, indicating broad-based weakness rather than company-specific concerns.

Bearish Options Play and ETF Positioning in Turbulent Precious Metals Market
• 200-day MA: $20.49 (well below current price)
• 30-day MA: $31.62 (near-term resistance)
• RSI: 58.68 (neutral but trending lower)
• MACD: 1.36 (bullish divergence narrowing)
• Bollinger Bands: $28.33 (lower band) vs. $29.06 (current price)

Seabridge Gold’s technicals suggest a short-term bearish bias despite a long-term bullish trend. Key support levels at $28.33 (lower Bollinger Band) and $20.49 (200-day MA) are critical to monitor. The VanEck Junior Gold Miners ETF (GDXJ) and VanEck Gold Miners ETF (GDX) remain core sector benchmarks, but their 12-11% declines highlight the need for defensive positioning.

Top Options Plays:
1. SA20260220P29 (Put Option)
• Strike: $29 | Expiry: 2026-02-20 | IV: 78.41% | LVR: 13.17% | Delta: -0.4589 | Theta: -0.0204 | Gamma: 0.0712 | Turnover: 6,144
• High leverage (13.17%) and moderate delta (-0.46) position this put for a 5% downside scenario (ST = $27.61): Payoff = $1.39/share. Strong gamma (0.0712) ensures sensitivity to price swings.
2. SA20260220P30 (Put Option)
• Strike: $30 | Expiry: 2026-02-20 | IV: 79.50% | LVR: 10.34% | Delta: -0.5276 | Theta: -0.0163 | Gamma: 0.0704 | Turnover: 28,439
• High liquidity (28,439 turnover) and delta (-0.53) make this ideal for a 5% downside (ST = $27.61): Payoff = $2.39/share. Gamma (0.0704) and moderate theta (-0.0163) balance time decay with price sensitivity.

Aggressive bears should prioritize SA20260220P30 for its liquidity and leverage. If $28.33 support breaks, consider rolling into deeper out-of-the-money puts.

Backtest Seabridge Gold Stock Performance
The backtest of Salesforce (SA) after a -13% intraday plunge from 2022 to the present shows favorable performance metrics. The 3-Day win rate is 47.57%, the 10-Day win rate is 55.06%, and the 30-Day win rate is 57.09%, indicating a higher probability of positive returns in the short term. The maximum return during the backtest was 7.69% over 30 days, suggesting that SA can recover from significant dips and deliver moderate gains in the medium term.

Volatility Intensifies – Position for a Sector Rebound or Strategic Entry
Seabridge Gold’s 13% drop reflects a sector-wide correction in precious metals, but analysts remain bullish on its long-term potential. The key 52-week low of $9.40 is 18% away, and the 200-day MA at $20.49 offers a potential floor. Watch for a rebound above $31.62 (30-day MA) to confirm a short-term bottom. The gold sector leader GOLD (-3.46%) and leveraged ETFs like GDXJ (-12.1%) will be critical barometers. For now, position with defensive puts like SA20260220P30 or consider a strategic entry if $28.33 support holds.