Analysts warn: Silver and other precious metal prices are on the "edge of a cliff"

PANews December 28 News, according to Jintiao reports, as precious metals like silver continue to soar in price, some analysts warn that precious metal prices are on the “edge of a cliff,” and the risk of a correction is accumulating. Keio Macro analysts wrote in their report: “Precious metal prices have risen to levels that we find difficult to explain with fundamentals.” They expect that as the frenzy for gold subsides, silver prices may fall back to about $42 by the end of next year. UBS warned that the rapid rise in precious metal prices is largely due to insufficient market liquidity — which means a quick pullback is very likely. UBS emphasized that the short-term risks in precious metal trading have significantly increased, given that gold prices have hit new highs, and short-term investors face a high risk of taking profits. The end-of-year thin liquidity “may exacerbate price volatility,” making short-term trends harder to interpret. Wang Yanqing, Chief Analyst of Precious Metals at CITIC Construction Investment Futures, stated that from a fundamental perspective, there are no significant changes in the influencing factors for short-term precious metals and non-ferrous metals. Although there are long-term bullish factors such as “de-dollarization” in the market, the short-term and rapid rise has obviously over-traded the long-term bullish factors, with high speculative sentiment, posing potential risks to market stability.