Silver suffers "avalanche-like" selling again, plunging 17% intraday, erasing two days of gains! Gold also drops simultaneously, with precious metals collectively losing luster.

On Thursday, the price of silver dropped sharply, wiping out the gains from the previous two trading days. After experiencing a historic market crash, this white metal still struggles to find bottom support, and the price of gold also fell in parallel. Data shows that spot silver prices fell by as much as 17% intraday, but in early Asian trading, prices briefly reached above $90 per ounce. The previous rally in silver was too strong and the gains too high, setting a record for the rebound, and now it has fallen more than one-third from the all-time high set on January 29. Spot gold also had a maximum intraday decline of 3.5% during the volatile session. The sudden plunge in precious metals also dragged down the sentiment in the base metals market, with copper prices falling by over 1% and dropping below $13,000 per ton. As of the time of writing, spot silver fell by 10.6% to $78.8 per ounce; spot gold fell by 0.7% to $4929.45 per ounce; platinum and palladium also fell in sync. Analysts Brian Martin and Daniel Hynes from ANZ Research stated, "Gold struggled to hold onto yesterday's gains due to a lack of further buying catalysts. The strength of the US dollar has suppressed investors' buying interest, offsetting the safe-haven buying brought on by heightened geopolitical tensions in the Middle East. Any sustainable price increase may rely on support from the Chinese market, where physical buyers in the Shenzhen area have been stocking up for the Lunar New Year." The US Dollar Index held steady before the policy decisions of the European Central Bank and the Bank of England, rising by 0.16% to 97.80, hovering near a two-week high, which increases the purchasing costs for non-dollar buyers of commodities. Christopher Wong, a strategist at OCBC Bank, said, "Market sentiment across most asset classes, including regional stock markets and metals, remains subdued, creating a negative feedback loop in the context of insufficient market liquidity." Last month, precious metal prices soared significantly due to speculative funds, geopolitical turmoil, and concerns about the independence of the Federal Reserve. However, this rally came to a sudden stop over the weekend, with silver recording its largest single-day drop in history and gold experiencing its largest single-day drop since 2013. Investors had already built up significant positions in the precious metals market, and large inflows of funds into leveraged exchange-traded index funds and concentrated purchases of call options further fueled the rally in precious metals. During early Asian trading last Friday, prices of precious metals suddenly plummeted, and the decline continued into the beginning of this week until bargain buying emerged in recent trading days to provide support. The market is closely monitoring the policy impact of Kevin Warsh, who has been nominated as Chair of the Federal Reserve. US President Trump stated on Wednesday that he would never nominate Warsh if he had previously expressed intentions of raising interest rates. He mentioned in an interview that the possibility of the Federal Reserve cutting rates again is "indisputable" - a positive factor for interest-free precious metals. Analysts at Standard Chartered and others pointed out in a research report, "Until the monetary policy outlook becomes clearer, the price of gold may continue to fluctuate." Analysts believe that the short-term volatility is partly due to investors redeeming holdings in exchange-traded index funds, but "the structural driving factors of precious metals remain unchanged, and we still expect prices to resume an upward trend." Due to its smaller market size and weaker liquidity, silver has historically experienced more severe fluctuations than gold, its "sister metal." Nevertheless, the volatility in silver prices in this round stands out for its magnitude and rapid pace, with a large influx of speculative funds combined with thin trading outside the market further amplifying the price fluctuations. Strategist Mark Cranfield stated, "Traders will be watching the lows slightly above $71 this week, but the significance of the $70 level may be even more crucial. Silver prices have not entered the $60 range since December last year, and if they return to that range, it will further intensify the market's overall risk aversion sentiment."