Silver prices staged a sharp rebound on Tuesday after suffering their steepest single-day loss since 2021, underscoring the extreme volatility that has defined the precious metal’s breakout year.
After briefly touching $80 per ounce for the first time in history during overnight trading into Monday, silver prices collapsed, closing the session down 8.7% — the largest daily decline in more than four years. The reversal came just as quickly as the rally.
A Violent Two-Day Swing
Silver futures for March delivery jumped about 7% early Tuesday, last trading near $75.54 per ounce, recovering a significant portion of Monday’s losses. Even after the whipsaw move, silver remains up roughly 158% year-to-date, making it one of the strongest-performing major assets of 2025.
Market participants described the move as historic.
The rapid rise above $80 — followed by an equally dramatic collapse — highlights how crowded positioning, thin liquidity, and speculative momentum have amplified price swings across the metals complex.
Precious Metals Still Riding Powerful Tailwinds
Despite the violent pullback, the broader drivers behind silver’s rally remain intact. Precious metals have benefited from a rare convergence of forces throughout 2025:
- Safe-haven demand tied to geopolitical instability
- Inflation hedging amid long-term fiscal concerns
- A weaker U.S. dollar, boosting foreign demand
- Strong industrial usage, particularly in energy and technology
Silver, unlike gold, sits at the intersection of financial hedging and real-world industrial demand — making it especially sensitive to shifts in growth expectations.
Industrial Demand Remains a Key Support
Silver is a critical input across multiple high-growth sectors, including:
- Solar power and renewable energy infrastructure
- Data centers and AI-driven computing
- Electric vehicles and advanced electronics
Over the weekend, Tesla CEO Elon Musk publicly warned that China’s upcoming export restrictions on silver, set to take effect on January 1, could negatively impact global supply chains — a comment that may have added fuel to the metal’s recent surge.
Gold and Copper Also Stabilize
Silver’s rebound came alongside broader strength in the metals market:
- Gold futures recovered from Monday’s selloff, trading about 1.2% higher near $4,394 per ounce
- Copper futures climbed roughly 1.9%, reflecting optimism around industrial demand
That said, some strategists caution that 2026 may look different. With global growth expected to reaccelerate, future commodity leadership may shift toward cyclical materials rather than defensive precious metals.
WSA Take
Silver’s historic rally hasn’t ended — but it has clearly entered a far more volatile phase. The move above $80 exposed how stretched positioning had become, and the subsequent rebound shows buyers are still firmly in control. While industrial demand and geopolitical risk continue to support long-term prices, investors should expect sharp swings to remain the norm. Silver is no longer a sleepy hedge — it’s a momentum-driven battleground.
Read our recent coverage on Tesla Flagging Weaker Q4 Deliveries.
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