Silver skyrockets
According to the Commodity Market Analysis System of Shengyi Society, the silver market price on December 29, 2025 was 19186.67 yuan/kg, an increase of 43.03% compared to the average silver market price of 13414 yuan/kg at the beginning of this month (December 1); Compared to the beginning of the year (January 1st), the average price of silver in the market was 7450 yuan/kg, an increase of 157.54%.
Futures market: On December 29, 2025, the main contract of Shanghai Bank (AG2602) fluctuated widely, opening at 18210 yuan/kg, hitting a low of 18027 yuan/kg and then surging to 19998 yuan/kg. It fell sharply in the afternoon, dropping to a low of 17500 yuan/kg, with a intraday amplitude of 13.79%. The closing price was 18887 yuan/kg, with a significant volume of 1.4428 million transactions. In the last hour of trading, Shanghai Silver Red exceeded 10% to Green exceeded 2%. What happened in the market?
What happened in the market when Shanghai’s silver red exceeded 10% to green exceeded 2%?
The one hour “shocking reversal” (from a rise of over 10% to a green excess of 2%) was a “kill more” stampede under the resonance of supply and demand, macro, capital, policies, and external shocks. The core is the combination of high-level profit taking and external market drag, tightening risk control and amplifying liquidity gap fluctuations, limited inventory and warehouse receipt support, reversal of macro and risk aversion sentiment, and resonance between sector sentiment and fund stampede. The specific reasons are as follows:
1. High profit taking+killing and trampling:
Within the year, the increase exceeded 160%, and the high-level carrying capacity of 19998 yuan was insufficient, triggering programmed profit taking and active liquidation of long positions; Highly leveraged accounts (partially ≥ 5 times) are forced to cut their positions due to insufficient margin, resulting in a negative feedback of “selling – price drop – more closing positions”. When liquidity dries up, fluctuations are amplified by 10-15 times.
2. Collapse of international silver price linkage:
London spot silver plummeted from $83.94 to $75.11 within an hour (a drop of over 5%), while COMEX silver also experienced a synchronized drop. The internal market followed the rapid correction of the external market, and the convergence of the internal and external price differences triggered arbitrage selling.
3. Exchange risk control tightening:
The Zhishang Exchange has raised the metal performance guarantee deposit, while the previous exchange had already raised the silver guarantee deposit and limit up/down board, increasing the holding cost and prompting funds to reduce positions and exit, further suppressing buying power.
4. Macro and risk aversion sentiment reversal:
Rumors of progress in the Russia Ukraine peace talks have triggered a decline in safe haven demand, coupled with a short-term rebound in the US dollar index, putting pressure on the financial properties of silver and causing funds to quickly flow out of precious metals.
5. Limited inventory and warehouse receipt support:
Although inventory is low, the support of warehouse receipts for prices at high levels is covered by panic emotions, and only shows carrying capacity around 17500 yuan.
6. Resonance between sector sentiment and fund stampede:
In the early stage, silver, platinum, and palladium all experienced extreme increases due to the influx of speculative funds and expectations of interest rate cuts. On the afternoon of December 29th, the precious metal sector plummeted to a high level, triggering a “long kill long” trend. Programmed stop loss and forced liquidation quickly spread throughout the precious metal sector, triggering collective selling.
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