The Silver frenzy cooled, but it is not over
The market’s sudden interest in Silver came as a tornado, having no mercy and leaving nothing in place on its way to record highs. The white metal was worth around $30 per ounce in mid 2025, ending November at roughly $70 to reach its zenith in January at $121 per ounce.
What the hell happened? How come Silver quintupled its value in a few months?
There’s an easy answer and a more complex one, yet both end in the same spot: uncertainty.
Charles Dow taught us that the market discounts everything, but what happens when markets have nothing to discount?
That’s pretty much what happened since Donald Trump took over the United States Presidency for his second term – and blaming Trump is the “easy” answer. Back and forth in protectionism policies, global interventions, the battle with the Fed and threats in general leave investors with no clues about what may or may not happen next.
Throughout 2025, there was little to discount about the future. As a result, investors had just the past and the present to work with, and the present changed too furiously and too fast.
In such scenarios, seeking safety is the indisputable move, and there were few choices out there. The US Dollar (USD) was out of question, as trouble stemmed from the US. Gold also ran blindly to record highs and was far too expensive.
Guess someone looked at Silver, said, “Why not?” And the madness began.
Relief and balance, what’s next?
Some relief came at the end of January, exacerbated by profit taking and resulting in Silver’s ounce dropping to $64. Half of its value was trimmed in a little over a week. The rally that preceded the record was indeed overstretched, and the corrective slump that followed was also a bit too much.
The recovery from the bottom sees Silver price stabilizing at around $86, still almost tripling its value from mid-2025. Buyers are clearly more cautious as the collapse from records probably wiped out more than one trading account. Silver price is now more balanced, and the metal moves according to a more normal behaviour.
What can we expect from now on? Well, uncertainty’s fog eased, but hangs like a Damocles’ sword over traders’ heads. If something, investors seem more used to Trump’s back and forth and the impact of his actions has diminished – but remember, not dissipated.
The XAG/USD pair currently hovers around the 38.2% Fibonacci retracement of the $121.66-$64.08 slump at $86.00, so our friend Dow will say that a clear advance beyond the level should favor a recovery towards $100.00, the 61.8% Fibonacci retracement of the same slump. There’s one more thing we know: a sustained advance beyond the latter should result in a full retracement towards the top of the measured range.
But what if $86.00 refuses to give up? Well, buyers may well pause and decide to add around $77.60, the next relevant Fibo level. Once below it, the bullish case is likely to die and open the door for a slump beyond the base of the range.