Silver Suffers Historic 30% Single-Day Collapse, Analysts Warn of Deeper Losses

The silver market was rocked by a historic sell-off on Friday, with prices plunging more than 30% in a single session—one of the most severe single-day drops on record. The dramatic collapse was fueled by a rapidly strengthening U.S. dollar and heightened investor anxiety following former President Donald Trump's latest nomination for the Federal Reserve board, a move perceived as adding volatility to monetary policy outlook.

While such a steep decline often triggers bargain hunting, Jeffrey Christian, managing director and commodities analyst at the CPM Group, warns the pain may persist. "The fundamental drivers behind this move—concerns about persistent inflation, dollar strength, and geopolitical risk—are still firmly in place," Christian told Business Insider. "These factors traditionally support silver as a hedge, but the current momentum is overwhelmingly negative."

Christian outlined a concerning scenario where continued price erosion could spark a large-scale exodus from the metal. In a worst-case outlook, he projects silver could fall to around $68 an ounce, representing a further 17% decline from current levels.

The CPM Group is monitoring several key indicators for signs of sustained weakness, including waning speculative interest in futures markets, rising exchange inventories, and shifting momentum in silver-linked exchange-traded funds (ETFs) and related bond markets.

Despite the bleak short-term forecast, Christian maintains a longer-term bullish view, suggesting prices could stabilize at elevated levels or even resume their climb through 2026. However, he emphasized that investors should prepare for additional volatility and potential downside in the coming weeks.

Market Impact & Analysis: Friday's plunge underscores the heightened sensitivity of precious metals to U.S. fiscal and monetary policy signals. The sharp rebound in the dollar, often a headwind for dollar-priced commodities, combined with political uncertainty, created a perfect storm for silver. This event raises critical questions about the metal's immediate role as a traditional safe-haven asset during periods of market stress.

Trader Reactions: A Mix of Dread and Opportunity

Maya Rodriguez, Portfolio Manager at Clearwater Capital: "This is a brutal but necessary correction. The market had gotten ahead of itself. We're watching the physical demand response closely. If retail and industrial buying picks up at these levels, it could establish a solid floor."

David Chen, Independent Commodities Trader: "It's a bloodbath, pure and simple. The algorithms took over and ripped the heart out of the silver market. Christian's $68 target might seem extreme, but in this environment, with the dollar this strong, I wouldn't rule anything out. The so-called 'safe haven' just proved it can be very unsafe."

Arjun Patel, Chief Analyst at Precious Metals Digest: "The long-term thesis for silver, driven by green energy and electronics demand, remains intact. This is a short-term liquidity event amplified by leveraged positions unwinding. For patient investors with a multi-year horizon, this volatility creates entry points."

Rebecca Shaw, Veteran Silver Investor: "This is catastrophic mismanagement and market manipulation writ large. Decades of treating silver like a casino chip instead of real money have led us here. The regulators are asleep, and the big banks are feasting on the wreckage of retail investors' portfolios. When the real inflationary dam breaks, these paper prices won't matter, but today's losses are very real for people."