The 8.31% decline was not driven by fundamental sellers repricing silver’s value. It was driven by mechanics. Sell stops were stacked below the main bottom at $70.86. When that level broke the stops triggered and the market fell through to the 200-day moving average at $67.62 in a straight line.
The stock market was selling off at the same time. Leveraged positions in equities needed cash and silver was the easiest place to raise it. When you need money fast you sell what you can, not what you want to. Silver is liquid and it was sitting on top of a stack of stops. That is a combination that produces exactly the kind of move we saw on Friday.
The long-term supply deficit story has not changed. Mine production growth is limited. Industrial demand from solar panels, electronics, electric vehicles, and AI data centers keeps expanding. Physical demand indicators including vault withdrawals in China point to tightness underneath the paper market.
What to Watch
Monday morning is about one level and one question. The 200-day moving average at $67.62 held on Friday’s low at $67.57. Whether it holds again depends on what happens in the stock market. Friday’s 8.31% drop was driven by sell stops and margin call liquidation from leveraged equity positions. If equities stabilize on Monday the mechanical selling stops and the supply deficit that is still underneath this market gets a chance to matter again.
The macro is lined up against Spot Silver (XAGUSD) going into Monday. The U.S. Dollar Index is at its strongest since April. The 10-Year U.S. Treasury yield is above 4.5%. Rate hike odds sit at 98%. Federal Reserve Chair Kevin Warsh’s first policy meeting is later this month and Friday’s jobs number just handed him a strong labor market. Another down day in equities on Monday means more margin call selling in silver.
The 200-day moving average at $67.62 is the line. A hold there and buyers have a chance to stabilize. A break below it with conviction opens the door to the major support cluster at $61.00, $60.83, and the December 2025 breakout level at $59.34. Resistance is thick above with the 50-day moving average at $76.15 sitting inside the $74.63 to $83.61 retracement zone.
More Information in our Economic Calendar.