The Dam Has Burst In Silver And Gold...So Now What?

Submitted by QTR's Fringe Finance

Silver was up another 6% Wednesday morning this past week and traded at $91 an ounce. Whether or not we’re seeing a short squeeze or a blow-off top at this point is moot and irrelevant. To quote the dorky guy from 10 Things I Hate About You, “the sh*t hath hitteth the faneth”.

As I said about a week ago on a Twitter Spaces that I did with my friend Peter Schiff, I just had the feeling that the run-up in silver and gold was not over yet. I echoed these sentiments while talking to Larry Lepard last week, where we covered all things sound money and markets: Larry Lepard: 2026 Predictions For Bitcoin, Gold, Silver and Stocks

For years, most of you have been reading my blog and watching my podcast, where I have constantly talked about the fact that there would be a “blow-off valve” once too much pressure from money printing built up inside the monetary system. In May 2023 I first memorialized this prediction in this article:

The most likely candidates to “blowoff” are precious metals, in my opinion (and maybe even bitcoin).

I often predicted that this “blow-off valve” would be the consequences of money printing showing up in the prices of gold and silver. After all, the consequences of the dirty deed of money printing have to go somewhere, and other than the precious metals, the only other place it shows up nefariously is through rising consumer prices and a lower quality of life for low- and middle-class Americans.

That valve has blown off. So what do I do now, take profit? Here’s my take.

Let’s run quickly through what I see as the bull and bear case for silver and gold, although I’m long-term bullish on both of them for many years to come, so keep that in mind. Right now, the bull case for silver can be made in a couple of ways.

The first is that something unprecedented is obviously happening, and we may be in the midst of, or heading toward, a historic short squeeze that has often been speculated about by us “conspiracy theorists.” There are so many more ounces of paper silver out there than there are physical that wild whipsaws and distortions can definitely occur in the market. We’re seeing one of those. Who knows where the ceiling is?

That bull case is laid out here in this incredible interview with Andy Schectman: Is Silver At $200 Possible?. Andy argued that forced selling can look like a top, but in his framing it’s more like a circuit breaker that temporarily interrupts a squeeze dynamic by flushing out late, leveraged participants. The key, he says, is that this doesn’t address the underlying physical tightness; it just changes who holds the exposure, transferring it from weak hands to deep pockets.

That could be the bridge to a potential $200 silver case. If you believe silver’s move was starting to express a squeeze—whether from positioning, constrained supply, or demand urgency—then margin hikes can delay the “snap,” but they don’t necessarily eliminate it. They can interrupt momentum, reset positioning, and scare speculators away, but if the structural forces remain (physical off-take, restricted supply, institutional accumulation, industrial demand), the pressure can reassert itself once the market digests the margin reset and new capital replaces liquidated positions. In other words: the squeeze can be paused by policy, not solved by it.

Another interesting point that I brought up last week during my Spaces call was that from breakout to peak, silver’s moves have been closer to 10x in the past. This current breakout occurred at around $30 an ounce, so we’re only at about 3x at this point. If that historical trend holds, it would be how one could potentially construct a case for $150 or $200 silver down the road. Also silver’s inflation adjusted all time high is closer to $140/oz., so that’s something to keep an eye on.

For the bear case on the metals, what red flags I'm seeing, and my full analysis of what I'm doing with my metals position, read my full note here.

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This is not a recommendation to buy or sell any stocks or securities, just my opinions. I often lose money on positions I trade/invest in. I may add any name mentioned in this article and sell any name mentioned in this piece at any time, without further warning. None of this is a solicitation to buy or sell securities. I may or may not own names I write about and are watching. Sometimes I’m bullish without owning things, sometimes I’m bearish and do own things. Just assume my positions could be exactly the opposite of what you think they are just in case. If I’m long I could quickly be short and vice versa. I won’t update my positions. All positions can change immediately as soon as I publish this, with or without notice and at any point I can be long, short or neutral on any position. You are on your own. Do not make decisions based on my blog. I exist on the fringe. If you see numbers and calculations of any sort, assume they are wrong and double check them. I failed Algebra in 8th grade and topped off my high school math accolades by getting a D- in remedial Calculus my senior year, before becoming an English major in college so I could bullshit my way through things easier.

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