Silver Down 58% From Peak: Analyst Weighs 'Despair Phase' Risk

By Daniel Okafor

Silver has fallen roughly 58% from its peak near US$121–122 to about US$51.38, according to a TradingView chart analysis published on November 12, 2026. The analyst, Rendra Azrulsyah, asks a question now trading through the market: is silver entering the "despair" phase of a post-mania cycle?

His answer is measured. The correction is real. The despair label is not confirmed.

What does the 58% decline actually show?

The chart tracks FXCM XAGUSD on the daily timeframe. The price structure looks like a classic post-mania markdown. A parabolic advance reversed sharply. Swing highs have come in progressively lower since the peak.

That pattern supports a reading of fear and correction. But Azrulsyah draws a clear line between chart arithmetic and forecasting. The US$40 projection on his chart is a scenario, not a fundamental target confirmed by data.

The latest daily candle was still forming at US$51.38 when the screenshot was taken, so its OHLC values are not a confirmed close.

What does the "despair" phase mean?

"Despair" is a market-behaviour label, not an official economic indicator. Azrulsyah writes that it becomes convincing only after selling has persisted, buying interest and sentiment have broadly deteriorated, speculative positioning has been substantially cleared, and price begins to show selling exhaustion or base-building.

The 58% decline makes the scenario worth monitoring. But the chart alone—without current ETF flows, physical-market premiums, comparable volume data, and sentiment surveys—cannot establish that silver has entered that phase.

Why are real yields the core bearish pressure?

On October 28, the Federal Reserve held its policy rate at 3.75%–4.00%. Two members preferred a 0.25 percentage-point increase. The Fed described economic activity as strong and inflation as elevated.

That combination could keep rate expectations restrictive and limit demand for a non-yielding metal such as silver, according to the Fed statement.

The 10-year U.S. Treasury real yield stood at about 2.78% on November 10, per Treasury data. A high real yield raises the opportunity cost of holding precious metals. If real yields keep rising and the dollar strengthens, XAGUSD faces further pressure.

Does inflation help or hurt silver?

U.S. CPI rose 0.4% month over month in October, down from September's 0.6%. Core CPI rose 0.3%, matching August and September readings, the BLS reported. The agency could not publish year-over-year changes for many October series because it could not collect October 2025 survey data during the funding lapse.

The mechanism cuts both ways. High inflation can strengthen demand for hedges. But if markets conclude inflation will keep the Fed restrictive, real yields and the dollar may rise and pressure silver. Inflation alone is not automatically bullish.

How weak is industrial demand?

The World Silver Survey 2026 forecasts industrial demand to fall 3% in 2026, to 639.6 million ounces. Weaker photovoltaic demand, reduced silver use per solar panel, and material substitution weigh on the outlook. Electrical and electronics demand is forecast to decline 6%.

High prices also restrain jewelry and silverware demand as consumers and manufacturers cut purchases or use less material.

What does speculative positioning reveal?

The CFTC report for COMEX futures as of November 3 showed 37,002 non-commercial long contracts against 15,751 shorts—a net long position of about 21,251 contracts, roughly 18.4% of open interest. Net longs rose about 1,548 contracts from the prior week.

The market is not extremely crowded. But positioning remains net long, so further liquidation could add pressure if prices keep falling.

Why can silver declines accelerate?

The BIS documented that silver's strong rally through 2025 and early 2026 ended in a sharp sell-off in late January. Retail flows, leveraged ETFs, daily rebalancing, margin calls, and forced selling amplified the move. The BIS study shows silver was vulnerable to leveraged unwinding then; it does not prove the same liquidation is underway now.

What could stop a slide into despair?

The bullish counterweights come from the physical market:

• The World Silver Survey forecasts a 46.3-million-ounce market deficit in 2026, the sixth consecutive annual deficit, with mine supply down 2.5 million ounces.
• Coin and bar demand is forecast to rise 18%, with a 30-million-ounce net increase in ETP holdings.
• AI and data centres, vehicles, and power-grid investment remain longer-term demand sources.
• Recycling is forecast to rise 7% to 211.3 million ounces, adding secondary supply.

A yearly deficit does not guarantee higher prices. It means demand must be met from above-ground stocks or through demand adjustment. Capital flows, real yields, the dollar, and liquidation can dominate prices in the short term.

What are the two scenarios?

The downside scenario strengthens if the recent low area—roughly US$49–50 by visual estimate—fails on a daily close, price cannot reclaim the prior swing structure, and real yields or the dollar keep rising. Falling futures positions, ETF outflows, or downward revisions to industrial demand would confirm it.

The stabilization scenario requires that low to hold, price to stop making lower lows, and a break above the nearest declining swing high. Falling real yields, a weaker dollar, and firm physical or investment demand would add fundamental support.

The most balanced reading, per Azrulsyah: bearish for the short-term price structure, but the despair phase is not confirmed. Watch the US$49–50 area and the November 3 positioning trend—both will show whether capitulation is starting or ending.