Is the Rally Over? Silver Corrects Sharply
Silver prices plunged sharply on Thursday after briefly setting a new record in the Asian session. Profit-taking intensified as geopolitical tensions eased and the market recalculated the likely direction of US interest rates.
Latest price update: Spot silver XAG/USD is around $89.7 per troy ounce (bid/ask range 89.65–89.75), down more than 4% from today's peak.
Silver briefly touched $93.5 (an all-time intraday high) before turning sharply lower in the following hours. This correction reflects the market cooling off after the extreme rally and a shift in risk-off sentiment that was less intense than yesterday.
Demand for safe havens weakened after US President Donald Trump stated that reports indicated the escalation of violence related to the crackdown on protests in Iran was easing and there were no signs of imminent mass executions. Although the US remains closely monitoring, this tone was enough to ease market fears of imminent military action—which typically dampens interest in precious metals.
Additional pressure comes from a series of solid US data (such as PPI and retail sales), which has tilted market expectations toward a longer-term Fed rate hike. This situation is generally unfavorable for non-yielding assets like silver.
Market participants are now awaiting weekly jobless claims and the Philadelphia Fed Manufacturing Survey to gauge whether the economy is starting to slow or remains relatively hot—which will influence the direction of the dollar, yields, and the range of movement of precious metals.
Despite the sharp decline, some market participants believe that the Fed's independence and strong industrial demand could still act as a brake to prevent the correction from developing into a deeper sell-off.
Source: Newsmaker.id
