Silver crash - what's next? US equity market fragility?

8 snips

Feb 2, 2026

Ole Hansen, Head of Commodity Strategy at Saxo Bank, offers sharp market analysis on precious metals and commodity plumbing. He breaks down Friday's silver crash, explains mechanics like options, delta hedging and ETF flows. He also explores contagion into equities, FX and rates, and considers what liquidity and technicals mean for metals moving forward.

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INSIGHT

Crash Driven By Delta Unwinds And Liquidity

The silver crash was a liquidity and delta-unwind event, not pure bearish conviction.
Massive option call selling forced sellers to buy futures, which then reversed into a fire sale when the market turned.

ANECDOTE

Record SLB Option Volume Preceded The Drop

Ole recalled record option volumes in SLB and heavy call buying before the collapse.
That speculative option activity left dealers heavily hedged and vulnerable when prices reversed.

INSIGHT

Leveraged ETFs Amplified Downside Pressure

ETF rebalances and daily-leveraged products amplified selling pressure during the open.
That forced roughly $4 billion of futures selling into an already fragile market.

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Today, we unpack the Friday crash in silver, and to a lesser extent gold, noting that the Kevin Warsh as Fed Chair nominee news was a mere excuse for a market that was already showing signs of total dysfunction, as covered in our Thursday January 29 podcast. Elsewhere, we look at the general contagion of the metals volatility into other markets, including in rates, FX and equities, where we continue to monitor some strange behaviors that my suggest considerable market fragility. Today's pod features Saxo Head of Commodity Strategy Ole Hansen and is hosted by Saxo Global Head of Macro Strategy John J. Hardy.

The two links mentioned on today's pod:

Izabella Kaminska on X, one of the greatest observers of narrative versus reality and measurer of the Zeitgeist. Especially this post caught my eye today.

Russell Napier's most recent appearance on a podcast - one of the most important thinkers about the new market regime we are in and the need to ask the right questions appropriate to that regime.

Two or three times per week, you will also find links discussed on the podcast and a chart-of-the-day over at the John J. Hardy substack.

Read daily in-depth market updates from the Saxo Market Call and the Saxo Strategy Team here.

Please reach out to us at marketcall@saxobank.com for feedback and questions.

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Intro and outro music by AShamaluevMusic

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