Gold and Silver Plunge Sharply While Bitcoin Maintains Strength!

A notable divergence is occurring in global markets as the weekend approaches. While there are sharp sell-offs in precious metals, the relatively stable price of Bitcoin has reignited discussions about changes in investor risk perception. Expectations regarding monetary policies, in particular, are creating a clear performance gap among gold, silver, and cryptocurrencies.

Historical Volatility in Precious Metals
On Friday, gold prices fell approximately 9% to $4,877 per ounce, while the decline in silver was much more severe. During the New York session, silver prices dropped as much as 28%, reaching $82. These movements have brought the highest volatility levels in recent years for precious metals.
The CBOE Gold ETF Volatility Index (GVZ) surpassed 46, reaching its highest point since the pandemic shock of March 2020. Similarly, the Silver ETF Volatility Index rose to 123, setting a record since the index’s launch in 2011.

Interest Rate Expectations and the Dollar Effect
Behind these sharp price movements is the market’s rapid re-pricing of expectations regarding interest rates and liquidity conditions. The perception that interest rates may remain high for longer or that monetary tightening could occur puts pressure on non-yielding assets like gold and silver.

This pressure increased further after U.S. President Donald Trump nominated Kevin Warsh to succeed Fed Chair Jerome Powell after his term ends. Warsh’s past criticisms of loose monetary policy and stance against balance sheet expansion led to a strengthening dollar. The US Dollar Index rose to 96.94, reaching its highest point of the week.

Bitcoin Offers a More Balanced Outlook
During the same period, Bitcoin’s price moved more modestly compared to precious metals. Fluctuating within the $82,000–$84,000 range throughout the day, BTC saw a slight increase of 0.2%, trading at $83,873. Nevertheless, Bitcoin has lost over 6% on a weekly basis.

Market sentiment remains cautious. The Crypto Fear and Greed Index fell 10 points in the last 24 hours to 16, indicating “extreme fear.” However, some forecasting platforms are seeing renewed expectations that Bitcoin could again target $100,000.