Silver is on the rise, approaching the top of a steep upwards channel around $96.50 to $97.00. Although momentum indicators are at multi-year highs, the trend appears stretched. The daily MACD shows strong momentum above the neutral line. Currently, silver is nearly 45% above its 50-day moving average, a record extreme. This suggests a possible consolidation or correction may occur, even if there are no clear signals of a pullback yet. The recent upper range, around $82.70, could provide initial support. In economic news, US Producer Prices increased by 3.0% in November, affecting currency pairs such as EUR/CHF. Concerns from ECB officials have shifted focus to Eurozone data, while USD/CHF remains stable amidst inflation updates and geopolitical issues. Gold prices have soared to around $4,640, driven by expectations of Fed rate cuts and falling US Treasury yields. Meme coins like Dogecoin, Shiba Inu, and Pepe are seeing rallies, with gains of 7% to 14%, suggesting a possible upward reversal. Meanwhile, the GBP/USD pair is dropping from earlier highs, reflecting stability in US Retail Sales, which rose by 0.6% in November. The latest estimates predict a modest 0.4% increase for November’s US Retail Sales. Silver is nearing significant resistance at $97.00, and while the momentum is strong, the market appears very overstretched. The current price is almost 45% above its 50-day moving average, a deviation not seen since the major market peak in 2011. This historical pattern suggests a strong chance of sharp consolidation or correction soon. Due to the intensity of this rally, implied volatility in silver options is likely at multi-year highs. Traders might seize this chance to sell premium with strategies like bearish call spreads, using the $97.00 level as a ceiling. The significant premium available could cushion losses even if silver continues to drift upward before retracting. For those holding long positions, it’s crucial to consider protection against a sudden drop. Buying put options can help lock in profits, with $82.70 being a logical target for a potential corrective move. While the cost of these puts may be high, they provide essential insurance against a quick price decline. It’s important to keep in mind the broader economic context from late 2025, when US producer prices rose by 3.0%, showing that inflation pressures are still strong. This complicates the Federal Reserve’s decisions, especially with a change in leadership on the horizon. The uncertainty surrounding future interest rates is a key factor driving current market volatility. The simultaneous rise in gold, which surpassed $4,630, highlights the strong trend in precious metals, fueled by a weakening US dollar. Throughout the fourth quarter of 2025, the Dollar Index (DXY) struggled, which continues to support commodity prices. Therefore, while any pullback in silver may be sharp, many may view it as a buying opportunity within an ongoing bull market.

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