In this video: Lets talk about the recent drop in the price of Silver! Video by Benjamin Cowen.
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Silver prices experienced a historic and violent "flash crash" on Friday, January 30, 2026, plunging as much as 37% in a single trading session. After reaching a record high of over $121 earlier in the week, spot silver plummeted to approximately $84–$85 per ounce by the close of the session. This marked silver's biggest single-day fall on record, effectively ending an explosive rally that had seen the metal gain over 60% since the start of the year.
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Market Summary & News Today
The sudden reversal was triggered by a "perfect storm" of macroeconomic and technical factors:
-Federal Reserve Leadership Change: The primary catalyst was a report that the Trump administration prepared to nominate Kevin Warsh as the next Federal Reserve chair. Markets perceived Warsh as less supportive of lower interest rates, causing the U.S. Dollar Index to surge and commodities priced in dollars to become more expensive for international buyers.
-Extreme "Overbought" Conditions: Before the crash, silver's Relative Strength Index (RSI) had tested levels above 80, indicating the market was extremely overextended and vulnerable to a sharp correction.
-Profit-Taking and Deleveraging: Institutional investors and hedge funds moved aggressively to lock in gains following the massive January rally. This triggered a wave of forced liquidations and "meme traders" exiting their positions simultaneously.
-Technical Triggers: Aggressive CME margin hikes and a thin holiday liquidity environment amplified the downward momentum, leading to intraday swings that some analysts described as a "wash out".
Market Context
Despite the severe one-day drop, silver remains significantly higher than its $31.65 price from one year ago. While some analysts warn that silver has officially entered a bear market (dropping more than 20% from its peak), others view the decline as a necessary "reality check" or consolidation phase before long-term industrial demand from green energy and AI sectors potentially resumes the upward trend.
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