iShares Silver Trust (SLV) tumbled 7% last week, reversing a 139% surge over the prior year. The selloff accelerated after Trump nominated Kevin Warsh for Fed chair, signaling policy continuity favoring a stronger dollar. Traders on r/wallstreetbets shared mixed reactions, with some celebrating put profits while others posted loss screenshots. A viral post highlighting silver’s 17% drop to $95 amid the dollar’s rise garnered 4,800 upvotes, sparking debate about the end of the metals rally.

Silver’s decline reflects broader macro trends: a stronger dollar and rising real interest rates. The 10-year Treasury yield hit 4.21% by February 5, pressuring non-yielding assets. Warsh’s nomination reinforces expectations of hawkish Fed policy, which typically benefits the dollar and weighs on silver. Investors are now scrutinizing FOMC minutes for clues on rate cuts or dollar weakness that could reverse the trend.

Despite the ETF’s $38 billion in net assets, physical silver markets remained in backwardation, with spot prices exceeding futures. This divergence suggests resilient demand for immediate delivery even as futures traders offloaded positions. ETF outflows amplified selling pressure, but long-term fundamentals like solar and EV demand may eventually stabilize prices. Monthly reviews of SLV’s holdings and NAV vs. spot prices are critical for tracking structural shifts.

The rally’s collapse underscores a broader investor awakening: passive strategies may no longer suffice. Apps offering $1,000 in stock for small investments highlight a shift toward active participation. As silver’s volatility persists, traders must balance macro risks with tactical opportunities in both ETFs and physical markets.