Merta/USA, January 31, 2026 — The silver market in the United States is currently witnessing a period of extraordinary price action. After hitting a historic milestone of $120 per ounce on January 29, silver prices experienced a sharp "liquidity wipeout" and profit-booking session as the month closed.
Current Market Scenario
As of today, spot silver is trading near the $99 - $106 range, following a significant single-day drop of nearly 12-14%. This correction comes after a month where silver outperformed almost every other asset class, surging over 60% in January 2026 alone.
Why are Silver Prices Fluctuating?
Several key factors are driving this massive movement in the US market:
- Fed Chair Nomination: Markets reacted sharply to reports that President Donald Trump intends to nominate Kevin Warsh as the next Federal Reserve Chair. Warsh is viewed as a "hawkish" candidate who may favor a stronger dollar and a smaller Fed balance sheet, which typically puts pressure on precious metals.
- Profit Booking: After silver nearly quadrupled in price over the last year, institutional and retail investors are "locking in" their gains, leading to a temporary sell-off.
- Industrial Demand vs. Deficit: Despite the current price dip, the fundamental story remains strong. 2026 marks the fifth consecutive year of silver supply deficits, fueled by the massive demand for AI-related electronics, solar panels, and electric vehicles.
- Geopolitical Tensions: Ongoing uncertainties and trade tariff threats continue to keep silver in demand as a "safe-haven" asset, though the strengthening US Dollar is currently acting as a headwind.
Future Outlook: What Experts Say
While the current "metals meltdown" has caught some off-guard, many analysts view this as a healthy consolidation.
- Citigroup has maintained a bullish mid-term forecast, suggesting silver could still reach $150 within the next few months if supply constraints persist.
- Technical Support: Traders are keeping a close watch on the $98 - $100 psychological level. If silver stays above this, the bullish trend is expected to resume.
Investor Note: The market is currently in an "extreme overbought" zone. New investors should be cautious of high volatility and consider "buying the dip" in small intervals rather than making bulk purchases at peaks.