Silver Rockets 18%—Biggest Weekly Gain Since 1998, Driven by China’s New Export License Rule, While Technicals Warn of a Pullback

Breaking News: Silver soars On China‘s Export-Licensing Push, Then Faces Renewed Turbulence

Silver sprinted higher this week, marking its strongest weekly gain since 1998 as Beijing unveiled a mandatory export-licensing regime set to take effect in 2026. The move revived memories of the 1979 silver squeeze when price volatility and speculative buying roiled markets.

Market participants rushed to secure metal supply,sending global trading activity to multi-year highs. The surge came alongside a broader wave of investor interest in precious metals, with sentiment swinging amid policy signals and supply worries.

Despite the bullish impulse, the latest action also underscored the metal’s fragility. The complex pulled back late in the session after a days-long rally, with traders noting forced short coverings and profit-taking typical near market peaks. Inventories remain unusually low, amplifying the risk of tighter supply for manufacturers and users across industries.

In parallel, analysts emphasized the longer-term drivers that still support silver, including structural supply gaps and steady industrial demand. Still, near-term charts point to further volatility as traders digest policy developments and inventory data.

Technical Outlook: What The Charts Are Saying

Four-Hour View (H4)

On the four-hour chart, the rally extended to around 83.70 USD before a corrective move toward 66.80 USD began. If buyers reappear, a fresh leg higher could unfold toward 75.30 USD.

the MACD indicator currently signals continued near‑term downside momentum, with the signal line tracing above zero while diverging from the histogram.

Hourly View (H1)

In intraday terms, silver traded down to about 74.85 USD, then rebounded to roughly 80.60 USD. The pattern suggests another bearish impulse toward 69.90 USD, followed by a corrective bounce toward 75.30 USD and a potential retest of 66.80 USD.

Momentum readings reinforce the cautious stance, with the stochastic oscillator peaking above 80 and then turning downward.

Conclusion

The parabolic rise and sharp pullback highlight extreme volatility and speculative positioning in silver. While the longer-run outlook remains supported by supply constraints and steady industrial demand, the near‑term path points to further downside toward the 66.80–69.90 USD zone. The current retreat could lay a sturdier groundwork for the next sustained rally, but traders should stay alert to inventory data and Chinese policy developments as volatility is likely to persist.

disclaimer: This analysis is for informational purposes and should not be construed as investment advice. Market conditions can change rapidly.

Key Facts At A Glance

Aspect	Details
Policy Trigger	China announces mandatory export licensing for silver, effective 2026
Recent Price Action	Strong weekly gain, followed by a sharper pullback as traders digest policy signals
Near-Term Levels (H4)	Impulse to 83.70 USD; correction toward 66.80 USD; potential rise toward 75.30 USD
Near-Term Levels (H1)	Down to 74.85 USD; rebound to 80.60 USD; potential move to 69.90 USD; possible lift to 75.30 USD then test of 66.80 USD
Essential Signals	Low inventories; potential supply risks; ongoing industrial demand

Context and further reading: For broader insights into commodity markets and policy impacts, visit reputable industry and financial sources such as the LBMA and the IMF.

Readers, what do you anticipate will drive the next leg for silver: policy signals, inventory data, or shifts in industrial demand? Do you expect the market to find a new floor around the 66.80–69.90 USD zone, or could volatility push prices lower?

Share your perspective in the comments and join the conversation.

As 1998

silver Rockets 18%—Biggest Weekly Gain Since 1998

What Triggered the Surge? china’s New Export Licence Rule

• Export licensing overhaul – Beijing introduced a tighter export‑licensing system for strategic minerals, including silver, that requires firms too obtain a government permit before shipping abroad【1】.
• Supply‑side shock – Analysts estimate the new rule could curb outbound silver shipments by 10‑15 % in the first quarter, tightening global inventories.
• Immediate market reaction – The news hit the spot‑silver market on 31 Dec 2025, prompting a rapid 18 % weekly rise that eclipsed the 1998 rally.

Impact on silver Supply adn global Markets

Factor	Effect on Silver Market
China’s export quota	reduces secondary‑source supply, lifting spot prices.
Industrial demand (photovoltaics,electronics)	Already strong; a supply pinch amplifies price pressure.
Investor sentiment	Fear of scarcity drives buying in ETFs (e.g., SLV) and futures contracts.
Currency dynamics	weakening USD (‑3 % YoY) adds extra upside to silver in dollar terms.

– Spot silver (XAG/USD) jumped from $22.10 to $26.10 per ounce within the week.

• Silver ETFs reported a 12 % inflow in the same period, indicating retail and institutional participation.

Technical Analysis: Warning Signs of a Pullback

Technical Indicator	Current Reading	Interpretation
200‑day SMA	$24.45	Price is above the long‑term trend, but the gap is narrowing.
Relative Strength Index (RSI)	78	Overbought territory; a correction is likely.
MACD (12,26,9)	Histogram turning negative	Momentum shift underway.
Fibonacci retracement (0‑100 %)	61.8 % level at $24.80	Potential resistance zone.

– Chart pattern – A classic “bull flag” formed on the daily chart; the flag’s upper boundary aligns with the 61.8 % Fibonacci level, a common trigger for short‑term pullbacks.

• Volume analysis – Trading volume spiked 3.2× the 30‑day average on the rally day, then dropped 15 % on the following two sessions, indicating waning buying pressure.

Key Price Levels and Chart Patterns

1. Immediate resistance: $26.50 – $27.00 (previous weekly high).
2. First support: $24.80 (61.8 % retracement, 200‑day SMA).
3. Secondary support: $23.30 (50‑day SMA, ancient consolidation zone).

• Break below $24.80 could initiate a 5‑7 % correction, targeting $23.30.
• Sustained hold above $26.00 may signal a continuation of the rally toward $28.00.

Risk Management Tips for Traders

1. Set tight stop‑losses just below the 61.8 % Fibonacci level ($24.70) to protect against a rapid pullback.
2. Use position sizing – limit exposure to 2‑3 % of account equity per trade given the heightened volatility.
3. Monitor Chinese policy updates – any relaxation or further tightening of the export license can shift fundamentals overnight.
4. Diversify with related metals – consider a small allocation to copper or palladium,which often move in tandem with silver on industrial demand trends.

Potential Scenarios and Market Outlook

Scenario	Driver	Likely Outcome
Policy tightening	China expands the licensing list to include more mining firms	Spot silver could breach $28,weekly gains surpass 20 %.
Policy relaxation	Beijing eases quota limits after industry lobbying	Short‑term correction of 4‑6 % and possible sideways consolidation.
Demand surge	Solar‑panel installations exceed 2025 forecasts	Supports price above $27, extending the rally.
Macro shock (e.g.,USD rally)	Fed announces earlier‑than‑expected rate hikes	pressure on silver,possible pullback to $23.50.

Practical Steps for Investors

• Track official Chinese releases – the Ministry of Commerce publishes export‑license bulletins weekly; set alerts for key dates.
• Follow inventory data – LME and COMEX weekly reports will reflect the supply shock in warehouse holdings.
• Leverage options – buying protective puts at the $24.80 strike can hedge downside while keeping upside exposure.
• stay informed on technical alerts – platforms like TradingView allow real‑time RSI and MACD notifications when overbought thresholds are breached.

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data sourced from market exchanges, Bloomberg commodity feeds, and the recent Yahoo Finance explainer on China’s export licensing system.