Trading guru Peter Brandt warns winners of silver’s epic rally to watch out

• Market veteran Peter Brandt has urged those who’ve profited from silver’s rally to be careful.
• The trading guru said that price peaks rarely last and assets can give up all of their gains.
• Silver, gold, and other metals have soared this year, partly because investors use them as hedges.

A Wall Street veteran warned jubilant silver traders to be careful after a searing rally in the precious metal’s price — days before it went into reverse.

Writing on X over the weekend, Peter Brandt congratulated those who’ve won big by betting on silver and platinum in recent months, but cautioned the market could quickly turn on them.

“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.”

Early on Monday, the market did indeed turn. Silver breached $80 an ounce for the first time before falling to around $70 by the market’s close. They rebounded 10% to around $78 on Tuesday. Silver futures have surged by over 150% this year.

Monday’s plunge followed a decision by exchange operator CME to raise margin requirements for trading various metals contracts, which forced traders to stump up more cash to place their bets.

Brandt, who’s been trading commodities for nearly 50 years and has more than 840,000 followers on X, also struck a wary tone in a Monday afternoon post on X following silver’s drop.

He wrote that in virtually every market cycle, even the “stubborn bulls” who’ve sworn they’ll never sell inevitably reach a point where they “no longer care if price goes to zero or a million, they have had enough pain and they want out.”

Brandt said he’s “not sure” the silver market is there yet. “Time will tell,” he added.

Investors pile into precious metals

Silver, gold, and other precious metals have soared to new highs this year as falling interest rates have boosted their appeal relative to cash and bonds.

Some traders have bought silver to gain exposure to the AI boom, as the metal is a key component in AI infrastructure, such as microchips and data centers. Because it conducts electricity well, it’s used in circuit boards, switches, EVs, and batteries, which is also driving demand for the metal right now.

Investors have also piled into precious metals as hedges against geopolitical and fiscal uncertainty, which threatens to weaken currencies such as the dollar and weigh on other assets such as stocks.

In a separate post late Monday on X, Brandt defended his cautious attitude toward the silver rally, noting that he has been trading silver since it was priced below $4 an ounce in the 1970s and has traded as much as 200,000 ounces in a single order.

“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, followed by a succession of laughing-while-crying emojis.

Brandt also dismissed the idea that silver’s price boom reflects a structural imbalance between supply and demand that will forestall any price decline.

“It has never been different,” he wrote. “Never will be. So enjoy it now.”

“This price action has NOTHING to do with supply shortages,” he wrote in another post. “This now is a game of money.”