2025-12-29 04:25:36

Silver quickly gave back its gains after breaking the key $80 per ounce level, with a single-day decline of up to 5%. This occurred during a five consecutive trading days of gains—during which silver soared to a new record of $83 per ounce—traders chose to realize profits amid this rare rally.

Market observers point out that we are experiencing an unprecedented generational silver surge. The underlying drivers behind this rally include persistent central bank gold purchases, large inflows of institutional funds into spot ETFs, and the Federal Reserve's three consecutive rate cuts last year, leading the market to bet on more rate cuts by 2026.

So why can silver outperform gold? The key factors are several. First, the silver market itself is small, with limited capacity, and liquidity can dry up quickly under tight inventories. In contrast, the London gold market has about $700 billion worth of tradable gold bars as a liquidity buffer, whereas the silver market lacks such reserves.

Even more concerning is the structural supply and demand imbalance emerging in the precious metals market. Physical silver demand is exceptionally strong, with buyers even willing to pay premiums for spot delivery—compared to waiting a year for delivery, buyers now pay an additional premium of up to 7%. This supply-demand mismatch is driving up trading activity and enthusiasm for silver.

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ConfusedWhale

· 7h ago

Sell and run for 80 dollars, really just chicken out, how far have we come Should have held a light position until breaking 100 The recent supply tightness in silver is real, but institutions are probably also cutting leeks Wait, do you really believe that interest rates will be cut again in 2026? I feel like it's reversing The inventory is so tight that I should have seen it clearly earlier, blame myself for not getting in early If this wave breaks through 85, I will add to my position and gamble on liquidity drying up Honestly, a 7% premium sounds outrageous, but physical assets are real hard currency Why does it feel like the big players are eating up positions at low levels, while retail just takes the leftovers? A retracement of 5 points is really nothing, looking back next year, this will all be the bottom

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JustAnotherWallet

· 7h ago

This wave of silver market is really a tool for cutting leeks; a 5% plunge directly clears retail investors out of the market.

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CryptoHistoryClass

· 7h ago

ah here we go again... small market cap = explosive moves = retail getting liquidated. seen this movie before lol

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TradFiRefugee

· 7h ago

Oh man, I even touched 83 but still had to sell, this rhythm is truly a roller coaster.

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ArbitrageBot

· 7h ago

It's the same old trick again, rush to 83 and then sell, a typical institutional method of cutting leeks.

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GasFeeCrier

· 7h ago

This wave of silver market really is incredible. It peaked at $83 and then dropped five points directly, a typical retail investor getting caught story. Institutions cut and run after dumping, even with such a tight supply chain, they still dare to smash the market, quite interesting. What does a 7% premium mean? This shows that the spot market is really short of supply. However, in the long run, it still depends on how the central bank will play. Now is the time to be cautious when entering. Small-cap stocks with liquidity drying up can hit the limit down in minutes.

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