Silver Falls Sharply After Breaking Record
Silver prices fell sharply after hitting record levels in recent sessions. After a strong rally, the market has now hit a sudden brake as market participants begin to take profits and sentiment has turned more cautious.
This decline occurred shortly after silver briefly broke through $80 per ounce for the first time. The rapid surge led many traders to believe the movement had overheated, making a major correction understandable.
One of the triggers was speculative demand from China, which had previously driven the rally. Once that momentum subsided, prices lost the primary momentum that had previously lifted them high.
From a technical perspective, many indicators suggest silver has entered an overbought phase. This means that buying momentum has become too dominant, making the market vulnerable to a reversal if buying flows weaken.
Interestingly, the silver premium in Shanghai was significantly higher than the benchmark price in London—even widening to over $8 per ounce. Extreme gaps like this often signal that the market is unbalanced and vulnerable to a correction. Afterward, silver prices fell to around $71.96 per ounce, marking a major correction from its peak. Rapid movements like this typically increase volatility: candlesticks lengthen, spreads widen, and selling can occur in rapid succession.
Going forward, the market will monitor whether this correction is merely temporary profit-taking or turns into a deeper decline. The key will be whether physical demand returns, and whether global risk sentiment supports or depresses precious metals.
Key points
- Silver plunged sharply after hitting a new record.
- It briefly broke through $80/ounce, then corrected because the rally was deemed too rapid.
- Speculative momentum from China is starting to subside.
- Technical indicators point to overbought → prone to a reversal.
- The Shanghai vs. London premium widened significantly (the market is out of balance).
- The price briefly dropped to around $71.96/ounce.
- High volatility: the market is waiting to see whether this is a healthy correction or the start of a further downtrend. (asd)
Source: Newsmaker.id
