A new year just passed, and a Bloomberg analysis report has stirred quite a bit of buzz in the market. Analyst Mike McGlone uses the classic technical indicator, the 50-week moving average, to predict that both silver and Bitcoin will face downward pressure in 2026. At first glance, this might seem alarming, but if you carefully analyze the characteristics of these two assets, you'll find that their risk profiles are fundamentally on different levels.

First, let's understand the concept of the 50-week moving average. It is the average price over the past 50 weeks, which can be seen as the "midline" of the asset. When the price deviates too far from this line—whether upward or downward—historical experience suggests that the market often adjusts and reverts back. McGlone has used this method for many years; while not always accurate, it is highly regarded within the industry.

What we should really be cautious about is silver. By the end of the year, silver closed at about $72 per ounce, which is 73% above the 50-week moving average. How exaggerated is this gap? The last time such an absurd premium appeared was back in 1979. Looking into historical data, after a crazy surge in silver prices, it plummeted in 1980, with a drop of 52%, and even touched as low as $15.5 per ounce. During that cycle, many heavily leveraged investors ended up with very tragic outcomes.

Some might say that the current market environment and conditions are different, and we can't simply apply historical patterns. That argument sounds reasonable, but the cycles of human greed and fear in financial markets have never fundamentally changed. Assets with strong commodity attributes like silver tend to have more extreme price swings, and once a correction begins, there are often no psychological defenses that can withstand it.

Bitcoin's situation is entirely different. Although McGlone also points out that it may face a correction, as a digital asset, Bitcoin embodies expectations for decentralized finance. After going through multiple cycles, a relatively stable fundamental understanding has gradually formed around these expectations. Short-term price fluctuations may occur, but the demand and application value behind it continue to expand.

From another perspective, as market sentiment shifts from exuberance back to rationality, the correction of traditional commodities like silver will be steeper and more abrupt because their price increases are entirely driven by emotion. Even if Bitcoin declines, supported by a gradually improving ecosystem and institutional recognition, its correction curve might be gentler. This is the key to understanding the risk differences between the two.

Therefore, rather than completely dismissing McGlone's view, we should instead refine our understanding of the risk characteristics of different assets. Silver may indeed require caution, but the story of Bitcoin is far from over.