Silver updates historical high and triggers profit-taking

The silver market is strongly bullish, with prices reaching a new historical high of $57.86 per ounce during today’s trading session.

The current rally is driven by two key fundamental factors. First, growing expectations of a December rate cut by the Federal Reserve (Fed) are now underpinning the entire commodity sector. Markets are pricing in an 87% probability of monetary easing, which reduces the opportunity cost of holding non-yielding assets like silver. Second, a structural physical deficit is intensifying. Large-scale metal shipments to London to cover October's shortage have depleted Shanghai stocks to a decade low, while ongoing trade policy risks are keeping US inventories tight, limiting the overall available supply.

The technical picture confirms strong upward momentum but also shows signs of a potential correction in the near term. The Chaikin Oscillator is at elevated levels, signaling massive capital inflows and buyer dominance. However, today's divergence—where the indicator declined while prices rose—may be an early sign of weakening momentum and the beginning of profit-taking.

The Stochastic Oscillator, with %K at 76 and %D at 72, remains in neutral territory but is close to the oversold zone. On the one hand, this setup suggests that bullish pressure persists; on the other hand, high %K and %D values, combined with the signal from the Chaikin Oscillator, paint a picture of an overheated market and a pullback risk.

Buyers are now poised to test a key resistance level at 58.00. The nearest support lies at 56.00, corresponding to Monday’s low. Given the signs of technical overheating and the market reaching historic highs, it would be a reasonable strategy to partially close long positions. The market is likely to pause in its current trend.

Take a look at the following trading plan:

Sell silver at the current price ($56.925). Place Take profit at $53.225. Set Stop loss at $58.200.

This forecast remains relevant between December 1 and December 7, 2025.