• Spot silver crashes 8% to $76.79 per ounce in a sudden selloff.
  • The drop is driven by a surge in the dollar and a broad risk-off move.
  • Analysts point to margin calls and stop-loss cascades in thin liquidity.

Silver Slides Sharply

Spot silver tumbled as much as 8% in intraday trading on Thursday, hitting a low of $76.79 per ounce before paring some losses. The sharp decline came amid a broader selloff in precious metals, with gold also down more than 2% on the day.

“It’s a classic liquidation event,” said a trader at a New York-based bullion bank, asking not to be named because they are not authorized to speak publicly. “We saw a cascade of stop-loss orders get triggered once silver broke below $80.”

The move accelerated after U.S. economic data showed stronger-than-expected jobless claims, fueling a rally in the dollar. The Bloomberg Dollar Spot Index gained 0.7% as traders priced in a slower pace of rate cuts from the Federal Reserve.

Industrial Demand Concerns

Beyond the macro headwinds, some market participants cited fears of slowing industrial demand, particularly from the solar panel and electronics sectors. Silver is a key component in photovoltaic cells, and recent inventory builds in China have raised questions about near-term consumption.

“The industrial demand story is still intact long-term, but right now the market is focusing on the macro,” said a metals analyst at a London-based consultancy. “The selloff feels overdone, but momentum is against it.”

Position Squeeze

The plunge was exacerbated by a build-up in speculative long positions on the Comex, according to exchange data. As of Tuesday, managed money net longs were near a three-month high, leaving the market vulnerable to a sudden unwinding.

“When everyone is on the same side, the exit is narrow,” the trader added. “We saw forced selling as margin calls came in.”

Spot silver was trading at $78.50 as of 3:15 p.m. New York time, still down 6% on the day. The metal has now erased gains made earlier this week after a brief rally above $83.

Correction: An earlier version of this article misstated the percentage decline. The drop was 8%, not 9%.