Volatility Is Back, 🚨100% Silver Lease Rates, and $100 Silver By April 2026

VIX making a new high pre-market (22.58 > Friday’s 22.44) says the stress didn’t “resolve”—it rolled forward.

That’s dealers buying volatility / selling delta again, which forces more index selling into the open and pushes correlations toward 1.

A higher VIX with no fresh news = positioning pain (short-vol, crowded longs) rather than narrative; the short-vol carry machine is still unwinding.

• Spot ripped to $53.55 overnight, then cooled to ~$51.50.

• Futures sit ~$50.71. The backwardation (spot > futures) narrowed—not because the squeeze is over, but because paper chased up and some spot froth bled off.

The tell that tightness remains: SLV borrow is still at zero shares (even if the fee/rebate eased). That means shorts can’t easily source inventory; the float is scarce.

When borrow vanishes, price dips don’t equal “problem solved”—they often mean risk managers took profits and hedges got shuffled while the underlying shortage persists.

Translation: last night was air out of the balloon, not a pin. As long as borrow stays scarce, registered bars keep bleeding, and EFP/lease metrics are tight, the path of least resistance is still higher—with violent snap-backs as futures and options desks try to keep up with the cash market.

Translation: the Shanghai Gold Exchange is quietly rationing metal.

A 68% plunge in the physical delivery ratio and “please take cash settlement” means: demand is stampeding, bars are tight, and the exchange is prioritizing real-economy users over speculators.

Read-through: when venues push paper over atoms, it’s not calm—it’s shortage management. Expect wider spreads, stickier backwardation, and higher spot premia until supply catches up—or price forces it to.

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🪙 Gold & Silver

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Silver Lease Rates >100% = fire alarm.
When it costs triple-digit annualized to borrow physical silver, it means large bars are scarce right now to a higher degree than we have never seen.

Signal, not hype: Michael Oliver—who nailed the momentum break that ignited silver’s latest run—just lifted his target to $100 by April ’26.

His work isn’t about vibes; it’s structural trend math: once momentum flips and supply is tight (backwardation, lease spikes), big money chases the new regime. Translation: the trend change is real, and the ceiling investors used to trade against just moved way higher.

Yes—this is the “debasement trade” finally getting priced.
For 54 years we pretended paper could replace base-layer collateral; a whole generation of managers only knew the Fed put.

Now deficits are runaway, real yields are volatile, sanctions risk is real, and collateral quality is suspect—so central banks are rotating from sovereign IOUs to gold.

Translation: this isn’t a fad; it’s a structural reserve shift. When the backstop is faith and the printer, you buy the asset that settles on contact. Gold (and monetary silver) are simply reclaiming the job paper dodged.

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Luke Lovett
Cell: 704.497.7324
Undervalued Assets | Sovereign Signal
Email: [email protected]

Disclaimer:
This content is for educational purposes only—not financial, legal, tax, or investment advice. I’m not a licensed advisor, and nothing herein should be relied upon to make investment decisions. Markets change fast. While accuracy is the goal, no guarantees are made. Past performance ≠ future results. Some insights paraphrase third-party experts for commentary—without endorsement or affiliation. Always do your own research and consult a licensed professional before investing. I do not sell metals, process transactions, or hold funds. All orders go directly through licensed dealers.