In early trading on Friday, the silver price continued its relentless ascent, breaking through several key levels. Spot silver reached an intraday high of $99 per ounce for the first time, marking a staggering gain of over 38% for the first month of the new year, positioning itself just a step away from the major psychological barrier of $100.
From a technical perspective, traders view the $100 level as a crucial psychological and structural threshold. Having shattered major resistance zones, silver has now brought this significant integer firmly within its immediate sights. Earlier in the week, silver had temporarily lagged behind gold's strong performance, leading many analysts to predict a significant correction. However, after a brief consolidation, silver chose to break out upwards instead, a move that fully demonstrates the market's unwavering recognition of and confidence in its latent explosive potential. Some market commentators point to the strength in silver mining stocks and the spot price as evidence of sustained momentum. Earlier this year, economist Peter Schiff highlighted the robust rebound in mining shares, noting that despite a short-term dip in metal prices, the prevailing market valuations indicate an improving sentiment across the entire sector. World-renowned Japanese-American investor, entrepreneur, educator, and bestselling author Robert Kiyosaki has reiterated his long-term bullish outlook for silver. In comments shared at the end of 2025, he suggested that the price of silver could reach a range of $70 to $200 by 2026. Stefan Gleason, the CEO of Money Metals Exchange, a top-tier US precious metals dealer and storage operator, occupies a unique vantage point. His position places him directly within the retail precious metals supply chain, offering an insider's perspective rather than an external view. From this standpoint, he gains real-time insights into order flows, customer repurchase trends, wholesale procurement status, and the operational constraints that determine whether investors can actually obtain specific products at any given moment. In a recent interview, he indicated that the current silver market rally appears to be driven by new investors entering the market, while long-term holders are taking some profits off the table. Although the selling pressure is significant, it is being absorbed by a greater number of new buyers drawn in by headlines and price volatility. Furthermore, serious supply-demand imbalances and liquidity squeezes are indeed occurring in markets outside the US, particularly in London and Asia. The premium levels in these regions reflect the reality of a much tighter physical market. Gleason described the retail situation as chaotic, with active trading on both the buy and sell sides. Demand over the past three to four weeks has been characterized as exceeding levels seen even during the COVID-19 pandemic, despite long-term holders realizing profits after silver's price doubled over the last 12 months. Gleason stated that the US is not currently facing a true shortage of raw silver material. A better way to understand the pressure is that 1000-ounce silver bars used for minting are still available in the US, but bottlenecks in the refining and minting processes are causing order backlogs, product unavailability, and soaring premiums, creating the public perception of a shortage. The real bottleneck lies in the limited US silver refining capacity; refineries capable of processing silver have order backlogs stretching for months, with some even refusing to accept silver scrap entirely. This affects everything from silverware to 90% silver coins—materials that could otherwise be melted down and refined if sufficient capacity existed. The supply tightness is more pronounced outside the United States. Early in the year, concerns about tariffs led to significant silver inflows into New York, resulting in New York premiums and London discounts, with COMEX inventories once swelling to approximately 530 million ounces. Subsequently, as tariff fears eased and demand from Asia (particularly China and India) surged, the dynamic reversed. Concurrently, inflows into ETFs that take physical delivery from the London market have further intensified pressure there. The current price disparity shows New York silver priced about $0.50 lower than London and $2-3 lower than Asia. Given the costs and time delays associated with physical transport, these regional disparities may persist, creating localized supply pressures. Gleason pointed out that shifts in retail participation can occur very rapidly, as the actual ownership rate remains remarkably low. It is estimated that only about 1% to 1.5% of Americans hold meaningful amounts of gold or silver, excluding jewelry. Against this backdrop, even an increase in the proportion of the public buying silver from 1% to 2% or 3% would generate demand sufficient to exceed what the market can smoothly absorb. This helps explain why the current price surge might signal the beginning of a new phase of growth in US retail demand, even if the entire system is not yet in a full-blown emergency. Market speculation suggests that Deutsche Bank may have previously taken a "short" position on silver during this rally. Now, with silver prices soaring dramatically, the bank might be forced to buy silver at high prices from the market to fulfill its delivery commitments (having sold silver at lower prices initially), potentially incurring losses. This kind of forced buying exposes the difficult position all those who are short silver currently face. Comments from Robert Gottliebsen are also cited, suggesting that US gold and silver banks hold long positions and are benefiting from this move. Overall, however, the driving force behind this rally leans more towards structural supply-demand contradictions rather than being solely triggered by the困境 of individual institutions. Gleason concluded by stating that the most reliable signal of a short squeeze carries implications far beyond temporary retail shortages or spiking premiums. Exchange inventories and liquidity are emphasized as critical indicators, especially signs that industrial users are beginning to bypass exchanges altogether and procure directly from mines and refiners, thereby draining available metal from the market. Only when shortages permeate this commercial level does it signify a genuine crisis. His conclusion is that existing signs point to supply tightness in parts of the world, but a full-blown global short squeeze has not yet materialized.
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