Gold and Silver Rage! Asian Morning Trading Plunges, Silver Surges to a New High of $84 before Dropping Over 10%, Gold Falls Below 4,500

On the eve of 2025’s conclusion, one of the most watched assets this year: gold and silver, finally experienced a wave of intense volatility after reaching record highs. On December 29th during the Asian session, spot silver in the early trading hours continued last week’s rally, rising to approximately $83 per ounce, once again hitting a historic high. Shortly after, around 8 a.m. Taipei time, it sharply reversed downward, with a daily fluctuation exceeding 10 percentage points. Meanwhile, spot gold retreated from the high around $4,500, briefly falling below the $4,480 mark. By the time of press, gold rebounded to $4,511, and silver recovered to $79.9.

Silver hits new high, Asia morning sees a 10% plunge

After several consecutive trading days of soaring, spot silver surged by up to 10% today, reaching $83.75 per ounce, then plummeted sharply, turning from gains to losses of about 6% in a short period, testing lows near $75. At the same time, spot gold’s decline expanded to over 1%.

Bloomberg pointed out that silver prices retreated after breaking through the $80 per ounce threshold for the first time. The reason was traders taking profits from this record-breaking rally; this surge was driven by structural supply and demand imbalances, with speculative trading and structural supply-demand issues pushing silver prices to historic highs. After a brief dip, silver prices rebounded. A weakening dollar and escalating geopolitical tensions boosted the appeal of precious metals, driving silver, gold, and platinum to hit record highs before the year’s end.

Bloomberg: The reason for the sharp decline in precious metals is traders taking profits

Since the beginning of this year, silver has accumulated gains of over 150%, and gold has surged more than 70%. The long positions are crowded, and technical indicators remain in overbought territory, making the market highly sensitive to any negative news or noise. As the year-end holidays approach, overall liquidity is low, and large profit-taking and stop-loss orders triggered by algorithmic trading tend to amplify price volatility, creating so-called flash crashes. Additionally, recent market expectations of a temporary easing of the Russia-Ukraine situation and geopolitical risks have led some safe-haven funds to reduce their holdings on rallies, temporarily weakening the safe-haven demand for precious metals.

Despite the increased short-term volatility, some institutions still emphasize that the medium- and long-term logic of the gold and silver bull market remains unchanged. Central banks worldwide continue to increase gold holdings, the Federal Reserve has initiated a rate-cutting cycle, the dollar is expected to weaken in the medium to long term, and expanding industrial demand for silver in industries such as photovoltaics, electric vehicles, and AI data centers are viewed as four major structural factors supporting precious metals’ trends. The silver market has been in a supply deficit for several consecutive years, with inventories at major exchanges continuously declining, making prices more sensitive to capital flows and sentiment changes.

This article “Gold and Silver Rage! Asia Morning Plunge, Silver Surges Past $84 Before Rapid Drop of Over 10%, Gold Falls Below $4,500” first appeared on Lian News ABMedia.