Peter Brandt vindicated after calling silver's crash to $70

A trader with decades of experience told silver investors to watch out just before prices took a dramatic swing this week. Peter Brandt issued his warning over the weekend, and the market proved him right within hours.

Brandt was on X congratulating people who made money betting on silver and platinum lately. But he added a note of caution. “Being right is fun,” he wrote. “But know this, moves can far exceed anything expected. And tops come quickly when they come. And retracements are almost always full.”

The market turned sharply on Monday morning. Silver prices broke through $80 an ounce for the first time ever before dropping to around $70 by day’s end. Prices bounced back on Tuesday, climbing 10% to reach around $78. This year alone, silver futures have jumped over 150%.

The Monday drop came after CME, which runs the exchange, made traders put up more money to place their bets on metals contracts. This requirement forced many to come up with extra cash.

Brandt, who has traded commodities for nearly 50 years and has more than 840,000 followers on X, posted again Monday afternoon after silver fell. He said that in almost every market cycle, even the most determined buyers who promise never to sell eventually hit a breaking point. They reach a stage where they “no longer care if price goes to zero or a million, they have had enough pain and they want out.”

He said he’s “not sure” if silver has reached that point yet. “Time will tell,” he added.

Why precious metals keep rising

Precious metals like silver and gold have hit record highs this year. Lower interest rates have made them more attractive compared to cash and bonds. Some traders bought silver to get a piece of the AI boom, since the metal goes into AI equipment like microchips and data centers. Silver conducts electricity well, making it useful in circuit boards, switches, electric vehicles, and batteries.

Investors have also turned to precious metals as protection against global uncertainty and government debt problems, which could hurt the dollar and stock markets.

Trader defends cautious approach

Late Monday, Brandt defended his careful approach to the silver rally. He mentioned trading silver since it sold for below $4 an ounce back in the 1970s, and once handled orders for 200,000 ounces at a time.

“Yet, I am jealous because there is an entire generation of Z babies trading on Silver on laptops from their mommy’s basements that know everything there is to know about Silver,” he posted, adding laughing emojis.

Brandt rejected the idea that supply shortages are driving silver prices up. “It has never been different,” he wrote. “Never will be. So enjoy it now.”

He was blunt about what’s really happening. “This price action has NOTHING to do with supply shortages,” he wrote. “This now is a game of money.”

If you're reading this, you’re already ahead. Stay there with our newsletter.