Sergey Diakov
After an impressive rally that pushed silver to its highest level of 2025, the market's showing clear signs of cooling off. The December 2025 silver futures contract (SIZ25) has taken a sharp downturn, sliding from the October 17 peak near $54 down to around $46.73—a 13% correction in less than two weeks. This move looks like textbook post-rally behavior, with traders cashing out their gains as the macro picture shifts.
Chart Analysis: From Vertical Climb to Technical Correction
The chart shows a classic trend reversal pattern after a nearly uninterrupted rally from $40 in early September to above $54 by mid-October. According to Barchart trader data, there's been a noticeable shift in short-term market dynamics following silver's steep climb since late August. The candlestick formation inside the red-shaded area displays a series of large red candles—clear evidence of sustained selling pressure after hitting the top.
This correction has pulled silver back toward support near $46–$45, an area that lines up with the September consolidation zone. If this level holds, it would confirm a healthy pullback within a broader uptrend. But a decisive break below $45 could signal a deeper slide, potentially targeting the $42–$43 range.
Despite the drop, the longer-term uptrend remains structurally sound. The previous steep advance, combined with limited volume spikes during the decline, suggests this current move is more about profit-taking than a fundamental shift in direction.
Drivers Behind the Decline
Several market factors have contributed to silver's pullback. Profit-taking after a vertical rally: Many short-term traders are closing out positions after silver gained nearly 35% in two months. Stronger U.S. dollar and yields: The rebound in Treasury yields and the dollar index has weighed on metals, making them less attractive as inflation hedges. Softening inflation sentiment: With recent CPI data showing moderation, investors have scaled back expectations of aggressive Fed easing—typically bearish for precious metals.
That said, silver's industrial demand remains robust, particularly from solar panel manufacturing and electronics, which supports a long-term bullish outlook.
Key Levels and Market Outlook
Technical support at $46.00–$45.50 is the immediate level to watch. If buyers step in at this zone, the market could stabilize and resume its climb toward $50 resistance. On the flip side, a breakdown below this support could extend the decline toward $42, where long-term moving averages converge.
In broader terms, silver's path forward will likely depend on upcoming U.S. inflation data and Federal Reserve commentary—both key factors shaping investor appetite for metals in Q4.
Sergey Diakov
