Analysts caution that while industrial demand remains strong, profit-booking could trigger a pullback.
Silver is back in the spotlight. Prices have surged to levels last seen more than four decades ago, climbing to about $49.5 per troy ounce in October, nearly matching the 2011 peak and brushing up against the record from 1980.
A Familiar Cycle, But Can It Last?
SEBI-registered analyst Rakesh Singhal said silver’s long-term pattern looks strikingly familiar. After topping out in 1980 and again in 2011, the metal spent years correcting and moving sideways before rallying again.
This latest run to $49.5 marks the third major upswing, but it came faster than before, arriving just 14 years after the last peak.
Singhal said silver is once again testing a critical resistance zone, raising the question of whether it can hold these levels. While booming demand from clean energy, electric vehicles, and electronics continues to lend support, he warned that the metal may soon face selling pressure.
“Profit-taking could start anytime,” he said, adding that if momentum cools, silver might see a gradual pullback rather than a crash. He also pointed out that inventories at major exchanges such as COMEX and London are still tight, which could add to volatility.
Industrial Boom Keeps Demand Strong
SEBI-registered analyst Vishal Trehan sees the rally through a different lens. He said silver’s 75% year-to-date surge, pushing past $51.37 per ounce, is being driven by genuine demand from industry, not just speculation.
Trehan said silver is used in solar panels, electric vehicles and consumer electronics. He said the metal’s high conductivity also makes it essential to next-generation technology, including 5G networks and photonics. He added that those industries are growing so rapidly that demand is outstripping supply.
A Persistent Supply Crunch
Trehan cited a continuing global deficit that’s been growing since 2021. He forecasts a cumulative shortfall of almost 796 million ounces from 2021 to 2025, which is nearly an entire year’s worth of global mine production. Recycling, he noted, hasn’t kept up.
He also said the U.S. government’s decision to label silver a “critical mineral” could lead to strategic stockpiling and faster mine approvals. For now, he believes the supply crunch will continue to support prices, though he advises investors to stay disciplined and use trailing stop-losses to protect gains.
Widening Premiums Halt New ETF Subscriptions
With silver prices hitting record highs and premiums widening, Kotak MF, SBI MF, and UTI AMC have paused fresh lump-sum investments in their silver ETF fund of funds. The premium on domestic silver jumped from 0.5% in early September to 5.7% by October 9, making new entries expensive.
The fund houses said the move aims to protect investors amid supply constraints, though SIPs and STPs remain open and normal subscriptions will resume once premiums stabilize.
What Is The Retail Mood?
On Stocktwits, sentiment toward Silverbees (Nippon India Silver ETF), managed by Nippon Life India Asset Management, was ‘bullish’ amid ‘extremely high’ trading volume.
Silverbees ETF has risen 92% so far in 2025.
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