Silver down 56% from record high as traders brace for more

Silver closed Friday at $53.83, marking its weakest finish of 2026. The precious metal is down nearly 56% from its record high of $121.74, while gold slipped below $4,000 during the same period.

Traders Position for Further Declines

Silver’s decline began when the speculative rally of January reversed amid higher futures margin requirements and forced selling. Recent pressure has intensified as surging oil prices threaten additional inflation and higher U.S. interest rates. Because silver pays no interest, rising rates make the metal less attractive to investors. Concerns regarding industrial demand have added further pressure to the price.

Market data indicates that traders are increasingly preparing for further losses. Silver’s three-month put-call skew climbed 10 points in four weeks to minus 3, its highest reading since early July. This shift indicates that more traders are buying protection against the metal falling further.

Hedge funds and commodity trading advisers sold $2.2 billion in silver futures in the three weeks ending October 13. These contracts allow traders to bet on future prices, and the volume of selling suggests large investors are reducing exposure as confidence in a recovery weakens.

Technical Levels and Physical Demand

Technical analyst Kev_Capital_TA identifies the $52–$55 range as critical support. If this level holds, the analyst suggests a potential rebound toward $63–$72. “If that support holds, all those crowded shorts become fuel for a bounce,” Kev_Capital_TA wrote. However, if the price loses the $52 level, it could be exposed to the $39–$45 range.

Michaël van de Poppe views the current market structure differently. “When I’m looking at Silver, I don’t think we’ll see a bull run soon. We’ve had it,” van de Poppe stated. He noted that silver has shown a rally of 7-8x in a matter of 2-3 years, which is unusual. “The typical price action of Silver is that it will fall back all of this run,” he added. Van de Poppe sees $40–$45 as a possible trading entry and $22–$26 as a longer-term level.

Peter Schiff considers silver attractive below $54. Meanwhile, physical demand in India presents another concern. India has authorized roughly 6,500 metric tons of silver imports ahead of its festive season. However, buyers remain hesitant after recent losses. Local premiums in India have fallen from $2.50 to 45 cents an ounce, suggesting that supply shortages are easing even as demand remains weak.

The Federal Reserve is scheduled to meet on October 27–28. Silver’s next direction may depend on whether the $52 support level holds and whether physical buyers return to the market.