Silver Defies Institutional Selling with Unprecedented Rally
The silver market is experiencing an unusual rally, defying conventional wisdom as institutional investors sell off the metal in record volumes. Despite this trend, prices continue to rise, with the weekly scoreboard showing a 6.94% advance and silver trading above the $60 threshold.
The catalyst for this movement was the July US employment report, which showed a loss of 23,000 jobs and a cooling labor market. This led to a drop in the implied probability of a September rate hike from the Federal Reserve, reducing the opportunity cost of holding bullion and contributing to the dollar's slide.
Market observers attribute the selling pressure from ETFs to profit-taking by large institutional players who had entered positions when prices were above $120. However, retail investors are moving in the opposite direction, with purchases of coins and bars jumping 18% recently.
The fundamental backdrop remains supportive, with a global supply deficit projected for 2026 and industrial demand evolving as new technologies reduce consumption from traditional sectors like solar manufacturing.