Monday's euphoria in the financial market seems to be over as silver is down 5% on Tuesday, while gold was trading 0.5% weaker during the London session.

Precious metals usually drop when banks start selling paper, silver, and gold futures – this is what we witnessed today. With demand for physical silver going through the roof, the paper price is moving sharply lower. 

Despite mints being sold out and physical silver selling for 33 USD and higher, paper silver collapsed back below 28 USD in what appears to be a controlled and manipulative move to suppress metal prices.

More importantly, gold failed to move higher during the last silver rally, which raises the question; can silver rally alone? Most likely not. Therefore, banks are getting very successful in suppressing gold at around 1,850 USD, and gold is still looking bearish, despite the massive silver rally. 

Moreover, if silver fails to hold January's highs of 28 USD and it closes the week below that level, it might mark a huge weekly reversal bar with a double top pattern and a false break to new highs. Those are three very bearish signs with a possible target of 25 USD in the next week. But the weekly close is still a couple of days away, so let's not get ahead of ourselves. 

On the other hand, the real fundamental situation should still support silver and gold - money printing by central banks, massive stimulus by governments, crashing economies due to COVID, bankrupting companies due to lockdowns, and of course - negative yields and falling USD.

Many people call for silver to go to 100 USD or even higher – it’s hard to imagine that when the metal can't even hold 30 USD. We think this week will be crucial for silver, it could start a bullish trend if the price closes above 28 USD, or it might very well lead to another slam down toward 25 USD. The banks will decide.