Silver Price Soars Past $100 Amid Speculative Frenzy

Key Developments in Precious Metals

Silver prices surged past $100 per troy ounce on Friday, marking a significant milestone driven by a wave of retail investor buying and momentum trading. The price was last up 5.1% at $101, extending a powerful rally that saw it gain 147% in 2025 and an additional 40% since the beginning of 2026.

Market Overview and Drivers

The rally is underpinned by a prolonged tightness in the physical silver market, which has experienced a structural deficit for five consecutive years. This situation is compounded by robust investment demand, with significant inflows into physically-backed ETFs. The metal's rise has also been supported by gold, which itself reached a record high of $4,988 per ounce.

Analyst Perspectives and Impact

Analysts note that silver's rapid gains have positioned it for a major correction. BofA strategists estimate a fundamentally justified price around $60, suggesting the current level is overextended. The gold-to-silver ratio has fallen to 50 for the first time in 14 years, indicating silver's outperformance against gold has become stretched. Experts warn of a self-propelled frenzy and advise investors to be cautious.

Summary and Outlook

While strong investment demand and physical deficits continue to support the price, the market is flashing warning signs. Analysts anticipate that profit-taking is likely in the near term, especially as the physical market shows signs of easing and liquidity in traditional markets improves.

FAQ

Q: Why did the silver price rise above $100?
A: The surge was driven by a combination of strong retail investor demand, momentum trading, and a persistent physical market deficit, alongside a rally in gold prices.

Q: What do analysts think about the current silver price?
A: Many analysts believe the price is in a speculative frenzy and is due for a significant correction, with some fundamental valuations suggesting a price closer to $60 per ounce.

Source: Investing.com