Analysts Warn: Precious Metal Prices Are Now at a 'Cliff Edge,' With Downside Risks Building.
Precious metals like silver continued to surge, with some analysts warning prices now sit on a “cliff’s edge” as pullback risks mount. In a report, Capital Economics analysts noted: “Precious metals prices have risen to levels we believe cannot be explained by fundamentals.”
They expect silver could fall to around $42 by the end of next year as gold’s rally frenzy cools. UBS warned the current rapid jump in precious metals is largely driven by market illiquidity meaning a sharp reversal is highly likely.
The firm emphasized short term trading risks have spiked: with gold hitting new highs, there’s a high chance short term investors will lock in profits. Thin year end liquidity “may amplify price swings,” making short term trends harder to interpret.
Wang Yanqing, chief precious metals analyst at CITIC Futures, said fundamental drivers for precious and non-ferrous metals haven’t changed notably in the short term. While long-term bullish factors like “de-dollarization” exist, the recent rapid rally has clearly overtraded those positives, with speculative sentiment running high posing potential risks to market stability.#TrendingTopic #TrendingPredictions #GOLD #Silver #warning! $BTC
