Silver’s Hangover Isn’t Over — The Unwind Continues
Silver hangover isn't over
Silver is still dealing with the aftermath. We outlined the range weeks ago, and the hangover is very much alive.
The crash was too sharp to resolve quickly. No trend, no narrative, just drift. Expect the $72–$90 range to dominate. We’re trading below the 50-day, with the 200-day far below, hardly a bullish setup.
Source: LSEG Workspace
Speculators
A minor uptick in net non-commercials, but zoom out and you see that the trend remains firmly depressed.
Source: LSEG Workspace
Volatility dynamics in reverse
The sharp upside move triggered significant options demand, driving implied volatility to elevated levels. As spot stabilized, the carry became too attractive to ignore, bringing in volatility sellers. This supply of volatility is now feeding back into downside pressure on spot.
Source: LSEG Workspace
Leaving Korea
Silver traded with the same speculative flavor as Korean equities, and the two moved in lockstep for a while. That relationship is now breaking, note the latest gap.
Source: LSEG Workspace
The dollar connection
Silver actually topped just when the DXY made the latest low.
Source: LSEG Workspace
Convexity
CTA downside convexity could become significant on a larger move lower, with systematic selling likely to accelerate if key levels give way.
Conclusion: This remains a market to fade strength, not chase weakness. Until positioning and vol fully reset, silver is likely to stay heavy within the range.
