Saad Ullah
⬤ Silver prices have posted a powerful rally in recent months, accelerating into a steep parabolic advance and reaching new cycle highs near the $117 level. The precious metal led the latest market cycle but now appears vulnerable to a potential major top. The technical picture shows price has risen rapidly above key exponential moving averages, reflecting strong momentum but also increasing the risk of trend exhaustion.
⬤ The price action shows silver moving nearly vertically during the final stage of the rally—a characteristic feature of parabolic trends. Such moves are often driven by aggressive momentum buying, but they tend to become unstable once buying pressure slows. Silver is now trading well above its longer-term averages, including the 50-day and 200-day exponential moving averages, indicating a stretched condition. Historically, when parabolic trends begin to fail, prices often retrace the entire terminal leg of the move rather than consolidating near the highs.
⬤ Momentum indicators reinforce the cautionary outlook. While relative performance measures and momentum oscillators have continued to rise alongside price, the steep slope suggests that upside acceleration may be approaching exhaustion. Though silver hasn't yet confirmed a reversal, the structure implies that downside risk is elevated at current levels. If selling pressure increases, silver could correct sharply as the market works off the excesses created during the final phase of the rally.
⬤ This development matters because silver often acts as both a precious metal and an economically sensitive asset. A meaningful correction could influence sentiment across the metals complex and signal a shift in risk appetite. As silver tests whether it can sustain its parabolic gains or begins to unwind, the upcoming price action will be critical in determining whether the recent surge marks continuation or the start of a larger corrective phase.
Saad Ullah
