Veteran trader Peter Brandt says cash silver now trades at a small discount to Comex silver futures. In his view, that undercuts the popular “paper silver” theory, which claims futures contracts hold down the price of scarce physical metal.
The call lands on a sore spot for silver bulls. Many bought on the bet that a physical shortage would lift spot prices above silver futures, a setup known as backwardation. Instead, the metal has lost more than half its value since its January record.
What Brandt’s Silver Futures Chart Shows
Brandt shared a weekly TradingView chart that tracks the gap between spot silver and the front-month contract on Comex, the CME Group’s metals exchange in New York.
At the latest reading, spot sat a few cents below futures. That is the normal setup, since futures usually price in storage and financing costs.
The chart also shows the spread swinging by several dollars in both directions around silver’s January peak. Since then, the gap has narrowed to almost zero.
Brandt posted the chart on X with a short verdict on the shortage narrative.
Why the Shortage Story Is Losing Its Grip
For years, the paper silver argument has been a pillar of the bull case. Supporters say far more silver trades on paper than sits in vaults, so a run on physical metal would eventually break the market.
A spot discount points the other way. When metal is truly scarce, buyers pay up for immediate delivery, and spot trades above futures.
Still, one weekly reading does not settle the debate. The paper silver claim rests on how much metal backs open contracts, not on the spread. A calm spread only shows the system works while few holders demand delivery.
Silver’s recent price action adds to the doubts. The metal hit a fresh 2026 low in late October, then rebounded as US-Iran peace talks lifted precious metals.
Brandt is no stranger to bearish calls on precious metals. In October, the trader flagged a bearish gold pattern on the weekly chart.
Silver’s slide has also drawn comparisons in crypto markets. Crypto analyst Benjamin Cowen has warned that Bitcoin could follow silver after a similar fake-out, a parallel based on price action rather than futures spreads.
If spot keeps trading below silver futures, though, the squeeze thesis will struggle to explain the next rally.
