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Silver’s current rally shows some signs of a bubble and is overbought, Ned Davis Research reportedly told clients.
According to CNBC, Ned Davis Research’s commodity strategist Matt Bauer said the commodity’s sharp December rally pushed trend and momentum indicators to levels rarely seen historically.
Silver has gone without a 20% correction for 833 days, and this run is near a 45-year record, Bauer said in a note on Wednesday. Based on these metrics, silver appears to be overbought, according to Bauer.
Silver spot (XAG/USD) was trading at $71.75 per troy ounce at the time of writing.
Silver has had a historic run in 2025, climbing nearly 150% in the year. The white metal has hit multiple all-time highs, with the most recent being $83.64 on Dec. 29, 2025.
However, a surging three-week flow into the ProShares Ultra Silver ETF (AGQ) signals heightened speculation and retail participation, according to Bauer. Yet, the metal’s year-end rally has not yet pushed into excessive optimism, the strategist added.
Bauer believes that this is an aging silver bull market, based on return and duration measures. He added that the positioning and sentiment below prior extremes indicate that a minor correction may position the metal for additional upside.
Silver’s 2025 rally comes as demand for the metal has increased amid rising industrial use. A surge in solar panels and electric vehicles demand has also bolstered its performance.
iShares Silver Trust (SLV), which tracks the price of silver, declined nearly 6% on Wednesday. On Stocktwits, retail sentiment on SLV remained ‘extremely bullish’ over the past 24 hours amid ‘extremely high’ message volumes.
SLV has surged over 146% in the past year at the time of writing.
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