Precious metals "major shakeout": Margin requirement increase triggers sell-off
Margin requirement increases trigger flash crash in gold and silver! A major year-end shakeout in 2025 sees gold fall below $4,500, while tech stocks face significant profit-taking pressure.
Yesterday, the precious metals market witnessed a dramatic "Great Reset." In an environment of thin liquidity, the parabolic rally that had lasted for weeks came to an abrupt halt.
Silver plunges : As the strongest asset of the year, silver fell nearly 9% yesterday , falling back to around $72-73 per ounce . The drop from its high point even exceeded 15%, marking the biggest single-day drop in five years.
XAU/USD, H4 Chart | Ultima Markets MT5
Gold (Gold) liquidation : Gold also suffered a sharp decline, falling more than 4% to $4,330 , far below the high of about $4,545 last Friday.
Key factor : CME Group raised contract margin requirements . This forced highly leveraged traders to liquidate their positions in an illiquid year-end market, further amplifying the decline.
Stock Market and Geopolitics: Tech stocks retreat, oil prices rise due to tensions.
Tech stocks saw profit-taking : Wall Street experienced significant selling pressure ahead of year-end. Tesla (TSLA) fell 3.3%, partly due to comments from Musk that "the surge in silver prices is bad for the supply chain"; Nvidia (NVDA) also fell 1.2%.
Energy Market : Unlike the stock market, renewed geopolitical tensions in the Middle East provided support for oil prices, which rose on safe-haven buying.
UKOUSD (Brent), H4 Chart | Ultima Markets MT5
Risk Warning : Trading leveraged derivatives involves high risk and may result in capital loss.
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Disclaimer : This article is for informational purposes only and does not constitute investment advice. Ultima Markets has taken reasonable steps to ensure the accuracy of the information, but the content is subject to change without notice.
