Silver fell about 9% to below US$76/oz, while gold dropped nearly 2.5% towards US$4,500/oz. The move extended a sharper correction in silver than in gold.
The earlier silver rise was linked to Trump–Xi pre-positioning, firmer industrial metals and spillover from AI-led equity gains. Support then weakened as US yields and the US dollar moved higher.
Macro Headwinds Build
India’s silver import curbs may tighten supply and lift the domestic premium, while also raising questions about near-term demand. Market tone is described as fragile unless yields stabilise or oil and geopolitical risks stop driving more hawkish rate pricing.
Potential support may come from more constructive steps towards reopening the Strait of Hormuz. Silver was last seen around the 76 area, with daily bullish momentum fading and RSI falling.
Support levels are cited at 74.60, 70 and 65, with 65 marked as the 200 DMA. Resistance is cited at 83.60 and 90, with 83.60 noted as the 50% Fibonacci level.
Silver has fallen sharply by around 9% to below $76 an ounce, a much more significant drop than gold’s, showing its sensitivity to industrial sentiment. This move appears driven by the recent strength in the US dollar and rising bond yields. For traders, this confirms that silver’s recent rally was fragile and not built on solid footing.
Positioning And Trade Setups
The recent spike in the 10-year US Treasury yield to over 4.8% is making non-yielding assets like silver less attractive. We are also seeing the US Dollar Index (DXY) remain firm above the 107 level, creating headwinds for all commodities priced in dollars. This macro pressure is now overriding the speculative interest that came from the AI-led equity boom.
We have to remember how the rally earlier this year was linked to broader risk-taking, similar to what we saw in the equity markets during late 2025. That support has now reversed, and new questions about demand are emerging from India’s import curbs. This is particularly concerning when we recall that India was importing near-record amounts of silver as recently as 2024.
With momentum fading and the Relative Strength Index (RSI) falling, derivative traders should consider strategies that account for further downside. Buying put options with strike prices near the key support levels of $74.60 and $70.00 presents a clear, risk-defined way to position for a continued slide. Shorting silver futures is a more direct approach for those anticipating a break below these supports.
The sharp drop has increased implied volatility, which makes options more expensive but also creates opportunities for income generation. Selling covered calls against an existing long position could be a prudent way to earn a premium while the price potentially drifts lower or sideways. This strategy can provide a small buffer against further losses.
A reversal in this trend would likely require a significant catalyst, such as a sharp drop in Treasury yields or a major geopolitical de-escalation that eases oil price fears, like the reopening of the Strait of Hormuz. Traders looking for a bounce could watch the $74.60 support level closely. A bull call spread could be a cost-effective way to trade a potential rebound toward resistance near $83.60 while limiting risk if the downtrend resumes.
