Silver’s rally continues in 2026, with prices up over 25% since Jan. 1. Some predict silver could surpass $100 an ounce for the first time. Factors include industrial demand, speculation, and supply issues. Demand for physical silver has surged, causing backwardation in the market. Speculative fervor and trade worries also contribute to the climb.
The surge in silver prices has led to increased daily volatility, with wild swings becoming more common. Physical silver demand has caused spot prices in London to surpass futures prices in New York, creating backwardation in the market. Speculative interest and supply deficits have also fueled the rally. The market’s tight conditions have led to a surge in prices and a migration of silver supplies.
Silver’s rally is part of a broader move in precious metals, with gold prices also on the rise. The psychology of metals markets often leads to silver following gold’s lead. Speculators and investors have been drawn to silver, driven by FOMO and the fear of missing out. Silver has transitioned from being relatively cheap to very expensive compared to gold in just one year. Silver’s rally continues in 2026, fueled by retail investors pouring $921.8 million into silver-linked ETFs like AGQ, PSLV, and SLV. Despite a recent drop in ZSL, investors are still eager to play both sides of the trade. The supply-demand imbalance is expected to shrink due to rising prices and reduced demand for jewelry.
In 2025, silver faced a supply deficit of 230 million ounces, but that is expected to change in 2026 and 2027 as prices rise. Industrial players and geopolitical concerns are driving the silver market, with speculators overwhelmingly long on silver in the futures market. Weekly CFTC data shows a surge in buying activity by independent investors. Silver’s rally in 2025 continues to gain momentum in 2026. Short interest remains low while options traders show interest. Open interest in out-of-the-money strikes on silver options has surged, controlling 5,000 ounces of silver per contract. Futures prices have reached levels not seen since the 1980s, trading significantly above trend trackers. Silver prices rose more than 11% last week, settling at $88.537 an ounce for March delivery. Market analysts caution extreme bullishness could signal a pullback, but some investors are betting on further price surges.
Read more at MarketWatch: Here’s everything investors need to know about the historic silver rally in 10 charts