Silver Rally Cools As Market Tests The New Fifty-Dollar Line
Silver is catching its breath after one of the strongest runs in its modern history. Spot prices this morning hover just below $50 an ounce, slipping a fraction on the day but still more than 60% higher than a year ago.
The pause follows a choppy week. From roughly $51 early last Monday, XAG/USD slid 2–3%, with the heaviest selling between Wednesday and Friday.
COMEX front-month futures briefly dipped under $49 on heavy volume above 100,000 contracts, while the LBMA fix in London dropped from about $52.20 to below $49.
Overnight trading has been quieter, with futures oscillating between $49.4 and $49.8 in thinner books. Physical markets are adjusting rather than collapsing.
Shanghai futures trade around 11,800–11,900 yuan per kilogram, off recent peaks but still elevated. In India, retail prices stand near ₹1.64–1.72 lakh per kilogram, down only ₹100 from the previous session.
Beneath the noise, fundamentals remain tight. The Silver Institute expects 2025 to deliver a fifth consecutive market deficit of around 95 million ounces, even as overall demand eases 4% to about 1.12 billion ounces.
Momentum Turns Lower
Exchange-traded products have added roughly 187 million ounces this year, an 18% rise, though the flagship SLV fund shows modest inflows over the last week and net outflows over the past month as investors bank profits.
Analysts describe the setback as a “sharp yet healthy correction” after a 67% year-to-date surge. At a recent industry dinner, Metals Focus stressed that repeated deficits and strong investment flows keep the structural bull case intact, even if high prices start to ration industrial and jewelry demand.
More speculative voices argue that silver near $50 is still cheap, but they remain outliers. Technically, the weekly chart still signals a clear uptrend, with prices well above long-term averages.
On the daily and four-hour views, momentum has turned down: RSI has retreated to neutral, MACD has crossed lower, and silver is chopping around its 20-day average.
Key support now lies in the $48–49 band, with $50 the pivotal line and the $52–54 zone the next serious test for the bulls.
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