On the eve of 2025, gold and silver, two of the most watched assets this year, finally experienced a period of sharp fluctuation after hitting record highs. During Asian trading on December 29th, spot silver initially continued its upward trend from the previous week, rising to approximately $83 per ounce, once again setting a new record high. However, around 8:00 AM Taipei time, it plummeted, with a single-day fluctuation exceeding 10%. Spot gold, meanwhile, retreated from its high of around $4,500, briefly falling below the $4,480 mark. As of press time, gold had recovered to $4,511, and silver to $79.9.
Silver prices plunged 10% in early Asian trading after hitting a new high.
After surging for several consecutive trading days, spot silver rose as much as 10% today, reaching $83.75 per ounce, before plunging sharply and falling by about 6% in a short period, testing a low near $75; at the same time, spot gold fell by more than 1%.
Bloomberg points out that silver prices retreated after first breaking the $80 per ounce mark. This was due to traders taking profits from the record-breaking rally, driven by a structural imbalance between supply and demand, which propelled silver prices to all-time highs. After a brief dip, silver prices recovered somewhat. A weaker dollar and escalating geopolitical tensions have increased the attractiveness of precious metals, pushing silver, gold, and platinum to record highs by the end of the year.
Bloomberg: Precious metals plunge due to profit-taking by traders
Silver has risen more than 150% year-to-date, and gold has surged over 70%, resulting in crowded long positions and technical indicators remaining in overbought territory. This makes the market highly sensitive to any negative news or disturbances. With the year-end holidays approaching, overall liquidity is low, and large-scale profit-taking and stop-loss orders triggered by algorithmic trading can easily amplify price volatility, leading to so-called flash crashes. Furthermore, recent market expectations of a temporary easing of tensions in the Russia-Ukraine conflict and geopolitical risks have led some safe-haven funds to reduce their holdings at higher prices, weakening safe-haven buying support for precious metals in the short term.
Despite increased short-term volatility, some institutions still emphasize that the medium- to long-term logic behind the current gold and silver bullish trend remains unchanged. The continued increase in gold holdings by global central banks, the Federal Reserve's initiation of a rate-cutting cycle, expectations of a weakening dollar in the medium to long term, and the expanding industrial demand for silver from sectors such as photovoltaics, electric vehicles, and AI data centers are still considered the four major structural factors supporting the precious metals' price movements. The silver market has been in a supply deficit for several years, and inventory levels on major exchanges have continued to decline, making prices more sensitive to fund flows and sentiment changes.
This article, titled "Gold and Silver Furious! Asian Markets Plunge, Silver Surges to $84 Before Dropping Over 10%, Gold Falls Below $4,500," first appeared on ABMedia .
