Silver prices suffered another sharp reversal on Friday as traders continued unwinding positions following an explosive speculative rally earlier this month.
The Silver price in US dollars (XAG/USD) traded near 78.77, down more than 5% on the day after briefly climbing above 87 earlier in the week.
The correction comes amid broader Dollar strength, rising Treasury yields and fading momentum across precious-metals markets.
Markets have increasingly shifted focus back toward the Federal Reserve after stronger US retail sales and import-price inflation data reinforced expectations for higher-for-longer interest rates.
At the same time, stronger equity markets and renewed Dollar demand have reduced safe-haven buying across metals markets.
Silver’s sharp earlier rally had also left positioning increasingly stretched.
The metal surged almost 20% within days earlier this month as geopolitical tensions, inflation hedging and speculative momentum combined to drive aggressive buying.
However, analysts warned that such rapid gains left the market vulnerable to equally violent corrections once momentum faded.
Industrial-demand uncertainty has also weighed on sentiment after weaker Chinese commodity demand indicators pressured copper and broader industrial-metals markets.
Even so, ongoing geopolitical risks and elevated inflation expectations continue to provide underlying longer-term support for precious metals markets overall.