Agnico Eagle Mines Plummets 6.4% Amid Precious Metals Selloff – What’s Next?

Summary
• Agnico Eagle Mines (AEM) tumbles 6.4% to $171.495, its lowest since late October.
• Silver and gold prices collapse post-record highs, triggering sector-wide profit-taking.
• RBC Capital downgrades AEM to 'Sector Perform' with a $185 price target.

Agnico Eagle Mines’ sharp intraday decline of 6.4% on December 29, 2025, mirrors a broader selloff in precious metals. The stock opened at $175.385 and plunged to a session low of $169.39, reflecting heightened volatility in gold and silver markets. With the sector reeling from margin calls and speculative unwinding, investors are recalibrating positions ahead of year-end liquidity shifts.

Precious Metals Reversal Sparks AEM’s Sharp Decline
Agnico Eagle Mines’ selloff is directly tied to the collapse of gold and silver prices following record highs. Silver, which surged to $80/oz overnight, plummeted 7.9% to $71.12/oz, while gold fell 4.5% to $4,349.30. Traders rushed to lock in profits after a year-end rally fueled by inflation hedging and industrial demand. Compounding the pressure, RBC Capital’s downgrade of AEM to 'Sector Perform' and a cut in its price target from $205 to $185 signaled growing skepticism about the miner’s ability to sustain growth amid margin-driven sell-offs. The downgrade, coupled with margin calls in leveraged positions, amplified short-term volatility.

Gold Sector Volatility Amplifies AEM’s Downturn
The gold sector is broadly under pressure, with sector leader Newmont (NEM) down 5.58% and peers like Barrick (GOLD) and Yamana (AUY) also retreating. AEM’s 6.4% drop outpaces the sector’s average decline, reflecting its higher exposure to gold price swings and RBC’s bearish revision. While the sector’s 52-week high of $187.50 for AEM remains intact, the selloff underscores the fragility of momentum-driven rallies in a market prone to overleveraging.

Options Playbook: Capitalizing on AEM’s Volatility
• RSI: 70.58 (overbought)
• MACD: 3.67 (bullish divergence)
• Bollinger Bands: Price at 171.53 (near middle band)
• 200D MA: 138.02 (far below current price)
• Support/Resistance: 167.95–168.44 (30D support), 116.69–118.41 (200D support)

AEM’s technicals suggest a short-term bearish bias amid overbought RSI and a breakdown below the 200-day moving average. Key levels to watch include the 30D support at $168 and the 200D support at $118. While the 14-day RSI indicates exhaustion in the selloff, the MACD’s positive divergence hints at potential short-covering rallies. No leveraged ETF data is available for direct hedging.

Top Options Plays:
• AEM20260102C175 (Call, $175 strike, Jan 2 2026):
- IV: 34.57% (moderate)
- Leverage Ratio: 137.85% (high)
- Delta: 0.2915 (moderate sensitivity)
- Theta: -0.5529 (rapid time decay)
- Gamma: 0.0496 (high sensitivity to price swings)
- Turnover: 20,787 (liquid)
- Payoff (5% downside): $0.00 (strike above current price).
This call option offers aggressive upside potential if AEM rebounds above $175, leveraging high gamma and leverage ratio to capitalize on volatility.

• AEM20260102C177.5 (Call, $177.5 strike, Jan 2 2026):
- IV: 37.26% (moderate)
- Leverage Ratio: 205.95% (very high)
- Delta: 0.2028 (moderate sensitivity)
- Theta: -0.4303 (rapid decay)
- Gamma: 0.0379 (high sensitivity)
- Turnover: 17,755 (liquid)
- Payoff (5% downside): $0.00 (strike above current price).
This contract’s extreme leverage ratio and moderate delta make it ideal for a sharp rebound scenario, though its high theta demands quick execution.

Hook: Aggressive bulls may consider AEM20260102C175 into a bounce above $175, while bears should monitor the 200D MA for a potential breakdown.

Backtest Agnico Eagle Mines Stock Performance
The backtest of AEM's performance after a -6% intraday plunge from 2022 to now shows favorable results. The 3-Day win rate is 54.73%, the 10-Day win rate is 58.78%, and the 30-Day win rate is 63.06%. Additionally, the maximum return during the backtest period was 8.44%, indicating that AEM has shown resilience and positive momentum in the aftermath of the intraday plunge.

AEM at Crossroads: Rebound or Reassessment?
Agnico Eagle Mines’ 6.4% drop reflects a market correction in overbought precious metals, but its fundamentals—$92B market cap, 53% EBIT margin, and 37% projected EPS growth—suggest resilience. The key will be whether gold and silver stabilize above critical support levels ($4,300 for gold, $70 for silver). Sector leader Newmont’s -5.58% decline underscores the sector’s fragility. Investors should watch AEM’s ability to hold above $168 (30D support) and the 200D MA at $138. For now, short-term volatility is likely to persist, but long-term holders may find value in dips, provided macroeconomic risks abate.