Silver's 21% Monthly Plunge Tests Critical Support

Silver’s 21% Monthly Plunge Tests Critical Support

Silver has shed nearly a fifth of its value in four weeks while ETF investors head for the exits, raising the prospect of a deeper breakdown if key technical levels fail to hold.

What to know

• Silver has fallen roughly 21% from its monthly high near $88.29 to $69.80, one of the sharpest corrections in the current bull cycle.

• SLV ETF outflows are accelerating, suggesting institutional and retail holders are actively reducing exposure rather than buying the dip.

• The gold-silver ratio has compressed to 64.8, but silver’s underperformance this month hints the ratio could widen sharply if support breaks.

What happened

Silver is trading at $69.80/oz after a punishing month that has wiped more than $18 off the spot price - a decline of nearly 21% from the March highs above $88. The sell-off has been far more aggressive than gold’s own 14.5% monthly pullback, and it is happening against a backdrop of persistent outflows from the iShares Silver Trust (SLV), the world’s largest silver-backed ETF.

The weekly picture offers a sliver of relief - silver has clawed back about 1% over the past five sessions - but the broader trajectory remains firmly bearish. The metal is now testing a zone that served as resistance-turned-support during the second half of 2025, roughly in the $67-$70 range. A decisive close below that band would open the door to a move toward the mid-$50s, a level not seen since late last year.

Who’s involved

ETF holders are the most visible source of pressure. SLV outflows have been building throughout March, and the pattern is notable because it suggests conviction selling rather than passive rebalancing. When ETF tonnage drops alongside falling prices, it typically means holders are choosing to liquidate rather than ride out volatility.

Managed money positioning on the COMEX is also worth watching. Speculative net longs in silver futures tend to unwind rapidly once momentum turns, and the speed of this month’s decline is exactly the kind of move that triggers stop-loss cascades among trend-following funds.

On the other side, physical buyers in India and China have historically stepped in during sharp corrections. Whether that demand materialises at current levels - or whether buyers wait for sub-$65 - could determine whether this support zone holds.

Why it matters

A 21% drawdown in a single month is severe by any standard, but it is especially significant given the macro backdrop. Gold itself has pulled back from above $5,400 to $4,524, yet silver has fallen proportionally harder. The gold-silver ratio sitting at 64.8 looks modest by historical standards - the long-term average is closer to 80 - but the direction of travel matters more than the absolute number. If silver continues to underperform, a ratio push back toward 75-80 would imply silver prices well below current levels even if gold stabilises.

The ETF dynamic adds a structural layer of concern. Silver ETFs act as a physical inventory buffer - when holdings decline, metal flows back into the market, adding to available supply at precisely the moment demand is weakening. During the 2020-2021 silver squeeze, SLV accumulated over 200 million ounces. The current unwind, while smaller in scale, echoes the same mechanism in reverse.

Industrial demand remains the bull case. Silver’s role in solar panel manufacturing and electronics continues to grow, and the supply-demand deficit that characterised 2024 and 2025 has not disappeared. But industrial fundamentals tend to set floors over quarters and years, not days and weeks. In the near term, technical positioning and fund flows are driving the price.

What happens next

The $67 level is the line in the sand. A weekly close below it would likely accelerate selling and bring $55-$58 into play as the next meaningful support zone. SLV holdings data, published daily, will signal whether outflows are stabilising or intensifying - any sign of inflows would be a contrarian bullish indicator. The gold-silver ratio deserves close monitoring; a sharp move above 70 would confirm silver is in a relative bear market against gold. COMEX open interest matters too: a flush of speculative longs, visible as a sharp drop in open interest alongside falling prices, often marks the kind of capitulation that precedes a tradeable bottom, though timing that inflection point remains uncertain.

This article is for informational purposes only and does not constitute financial advice. Always do your own research before making investment decisions.