Is the silver rally over? No — according to Azoria Capital founder Tavi Costa, the June 2026 sell-off in silver is a normal pullback after an unusually sharp run-up, amplified but not caused by new Fed chair Kevin Warsh’s hawkish debut, and nothing about the structural case for precious metals has changed.
Speaking with GoldSilver host Maggie Lake the day after Warsh’s first press conference sent gold and silver sharply lower, Costa argued the market is confusing a short-term reaction with a broken thesis. Below is a plain-English breakdown of his read on the sell-off, the signals he’s watching, and the one factor that genuinely worries him.
Key takeaways
- The silver rally is not over. Costa calls the drop a normal pullback after silver miners ran up 25–30% in four days — moves that size always retrace 3–5%.
- Warsh made the sell-off bigger, not different. The correction would have happened anyway; the new Fed chair’s hawkish tone just amplified it.
- Bullish signals are hiding in the tape: miners are holding up better than the metal, and copper and bond yields are refusing to confirm the hawkish story.
- The dollar is the real concern. A short-term breakout in the DXY index is the one factor that could keep pressure on metals for weeks.
- Costa trimmed, he didn’t panic. He took profits into the spike and is waiting for confirmation before adding back.
Is the silver rally over? Why Tavi Costa says no
Is the silver rally over? Costa’s answer is a clear no, and his reasoning starts with basic market mechanics. In the four days before Warsh spoke, some silver-mining stocks had jumped 25–30%, according to Costa. “Nothing moves 25% and doesn’t see a three to four to five percent pullback,” he told GoldSilver — a retracement after a move that size is not a warning, it’s routine.
What made this pullback feel worse was timing. Kevin Warsh, sworn in as Federal Reserve chair, used his first press conference in June 2026 to lean harder on inflation and price stability than markets expected. The reaction “rifled through the markets,” in Lake’s words, and precious metals took the hit. But Costa’s point is that the sell-off and the press conference are two separate things that happened to collide.
Why the silver sell-off would have happened anyway
The silver sell-off was overdue regardless of the Fed, in Costa’s framing. Strip out Warsh entirely, he argues, and a pullback after a 25% four-day spike would simply have been labelled “sell the news” and forgotten. Warsh’s hawkish posture didn’t create the correction — it made an already-normal correction more extreme.
That distinction matters for anyone deciding whether to sell. A pullback driven by positioning unwinds after a vertical move is a different animal from a pullback driven by a genuine change in the macro setup. Costa sees the former, not the latter.
Kevin Warsh’s hawkish Fed debut — and the Jay Powell parallel
Kevin Warsh’s first press conference was widely read as hawkish, but Costa urges caution before repricing metals around it. He points to history: when Jay Powell was first appointed, markets read his opening remarks the exact same way — as proof of a tough, non-dovish central banker. “A lot of the same people coming out now saying they like Kevin Warsh were saying exactly that about Powell,” Costa noted.
His deeper point is structural. Doing what Paul Volcker did — crushing inflation with punishing rate hikes — is extraordinarily hard in a world of large deficits and high debt loads. A Fed chair can sound hawkish at a podium; sustaining it against the arithmetic of the debt is another matter. Costa’s takeaway: don’t rebuild your investment thesis around a single press conference.
The three ways a Fed chair can “return to price stability”
Costa offered a useful framework: there are three ways Warsh could actually deliver the “price stability” he keeps promising, and only one of them is bearish for silver.
- Stretch the target. Quietly treat the 2% goal more loosely — caring about “the left side of the decimal, not the right,” as Warsh hinted. A de facto higher tolerance for inflation is bullish for hard assets.
- Raise rates. The classic tightening path. This is the genuinely bearish option for metals — but Costa doesn’t think it’s the plan.
- Change how inflation is measured. The one Costa thinks matters most and few are discussing. Reworking the inflation calculation — folding in productivity and AI-driven gains, or treating restrictive housing costs differently — could lower the reported number without tighter policy at all.
If price stability arrives via option one or three, the structural case for silver and gold stays fully intact.
Bullish signals hiding inside the sell-off
Inside a red day, Costa sees several tells pointing the other way. First, miners are holding up better than the metal itself. In a truly bad break, mining stocks usually lead the decline; they weren’t, and Costa reads that relative strength as a bullish sign. It echoes the automation-driven margin story he’s laid out in his broader mining-stock thesis for 2026.
Second, copper is resilient. Copper and precious metals typically lead to the downside together; copper’s refusal to break is a positive divergence. Third, bond yields are falling, not rising. If hawkishness were the real driver, two-year yields should be climbing — instead they slipped even as metals sold off, which tells Costa the market isn’t truly pricing tighter policy. He also flags easing inflation expectations, a softer oil market, and renewed flows through the Strait of Hormuz as reasons the “energy shock” narrative behind the hawkishness may be fading.
The one real concern — a stronger dollar
The dollar is the genuine risk, and Costa doesn’t downplay it. The DXY index broke out in the short term, and “you don’t want a strong dollar for metals,” he said. A daily breakout on a one-year chart is less alarming than a monthly breakout on a long-term chart, but it’s still a headwind that could pressure silver for a few weeks.
There’s a counterweight, though: emerging markets are holding up well. A systemic dollar squeeze would normally hammer emerging-market assets, and it isn’t. Costa also pushed back on the popular “cash is the only safe haven” view — that reflex is a product of the last few decades. Rewind to the 1970s and the safe haven was metals, not Treasuries. That older regime, he suggests, may be the one returning — a theme we explore in why record M2 money supply signals dollar devaluation and China’s move to a physical-gold settlement system.
How Tavi Costa personally handled the move
Costa is candid that he’s not a great short-term trader, and he treated the move as an investor, not a day-trader. He took profits into the 25% spike, moved to a little more cash, and added to Brazilian stocks — “probably a little too early,” he admitted, but they held up. Crucially, he’s not panicking and not chasing. He’s waiting for more confirmation before adding back to his metals position. For long-term holders, that patience — not the headline — is the signal worth copying.
Frequently asked questions
Is the silver rally over in 2026?
No, according to Tavi Costa of Azoria Capital. He views the June 2026 sell-off as a normal 3–5% pullback after silver miners ran up 25–30% in four days, and says nothing has structurally changed in the bull case for precious metals.
Why did silver sell off after the Fed meeting?
Silver fell after new Fed chair Kevin Warsh’s first press conference struck a more hawkish tone on inflation than markets expected. Costa argues the correction was overdue anyway after a sharp run-up, and Warsh simply made an already-normal pullback larger.
Is Kevin Warsh hawkish or dovish for gold and silver?
Warsh debuted with hawkish rhetoric, but Costa is skeptical it lasts — he notes markets said the same about Jay Powell at first, and that sustained Volcker-style tightening is very hard given today’s debt loads. If Warsh reaches “price stability” by loosening the target or changing how inflation is measured, that’s bullish for metals.
Does a strong dollar hurt silver prices?
Yes. A stronger US dollar is a headwind for silver and gold, and Costa calls a short-term breakout in the DXY index the biggest genuine risk right now. He notes, however, that resilient emerging markets suggest it isn’t yet a systemic dollar squeeze.
