Silver prices have increased by 70% this year, hitting a record high today!
2025-10-09 21:41:09
On Thursday (October 9th), spot silver prices surpassed 50, breaking through the all-time high set in 1980. The current upward trend in silver prices isn't even over yet. In addition to two core factors: continued growth in safe-haven investment demand and a significant increase in industrial silver demand in sectors like solar panels and electric vehicles, we've identified additional market clues influencing silver prices. These factors support a breakout above 50 and suggest higher prices.
Is this really the case? Isn't there a natural reason for every historical rise? If the silver price stabilizes at $50 this time, what will the market trend be? What are the fundamental differences between the current silver price rise and historical trends? The core difference between this round of silver's push towards $50 and the two previous upward cycles in 1980 and 2011 lies in the strong fundamental support for silver and the structural trend of continued devaluation of fiat currencies.
The current driving force behind the silver market has shifted away from frenzied speculation and toward a stronger focus on industrial production. Simultaneously, the expansion of silver exchange-traded funds (ETFs) has significantly broadened investment channels. According to the Silver Institute, industrial silver demand is projected to grow 4% year-over-year in 2024, reaching 680.5 million ounces. While industrial demand is projected to remain flat in 2025, it will account for 59% of total silver demand for the year. Of this total, the solar energy sector is projected to consume 195.7 million ounces of silver in 2025. A July report from the Silver Institute indicates that net inflows into silver exchange-traded products (ETPs) reached 95 million ounces in the first half of 2025, already exceeding the total inflow for the entire year of 2024.
As of October 7th, the iShares Silver Trust (ARCA:SLV), the world's largest silver ETF, has seen a year-to-date gain of over 60%. This performance reflects a trend of investors shifting their allocations to safe-haven assets. For years, silver mine production has lagged behind demand growth. Metals Focus predicts that by 2025, the silver market will face one of the largest supply deficits on record, reaching a projected 187.6 million ounces.
This significant supply gap has led many silver analysts to predict a breakout and sustained hold of the $50 mark. However, can the market effectively stabilize above $50? What market reactions will silver trigger once it breaks through $50? In an October interview with Investing News Network (INN), David Morgan, publisher of The Morgan Report, explained the strategic significance of silver reaching $50, calling this breakthrough "a critical Rubicon crossing" for silver. (Note: "Crossing the Rubicon" refers to the initiation of an irreversible trend.)
He pointed out, "From a market psychology perspective, silver has never broken through the $50 mark and effectively held steady in the past 50 years." He believes that a breakout above $50 is feasible, which would not only have a profound impact on the psychology of silver investors but also influence the automated algorithms currently used in silver futures trading, ultimately potentially pushing silver prices into an "unimpeded upward trend" (a.k.a., a "blue ocean market"). Analyzing from the perspective of investor psychology, Morgan believes that once silver prices reach $50, a clear divergence in the market will emerge: bullish investors believe silver will begin a trend upward, while bearish investors worry that prices will repeat historical mistakes and experience a deep correction.
He explained to the Investment News Network: "So what range will the real trend be in? My core job is to help more investors who want to understand the potential market and judge the price peak to sort out the logic." "No one can accurately predict the peak in advance, but I am convinced that the current market psychology is supportive of silver's upward trend."
Independent precious metals analyst Ted Butler agrees with Morgan's market assessment. In an October interview with Investing News Network, Butler stated that he had not anticipated silver's rapid ascent to $50, and that the speed of the upward movement made him question the sustainability of the rally. "But I firmly believe that silver will eventually break through $50," he said. In Butler's view, $50 is the critical point at which silver will garner significant attention from mainstream media. Once this level is broken, the silver market will enter a phase of public participation, with ordinary investors gradually entering the market.
Butler added, "At that point, retail investor buying will combine with the already accumulating institutional demand to further push prices higher." From a technical perspective, Butler believes the silver market is already experiencing backwardation (a phenomenon where futures prices are lower than spot prices), signaling a breakout above $50. This backwardation could trigger a rush to buy physical silver, with investors even opting to withdraw their holdings in the iShares Silver Trust (SLV). A surge in withdrawals of physical silver, already in short supply, could trigger a significant price surge.
Morgan said that in order to break the historical callback curse and allow silver prices to form a sustained trend above $50, silver prices must first complete the callback and build a stable consolidation range near the strong support level.
This correction and consolidation will allow silver prices to continue their upward trend "with a more certain rhythm." Structurally, the fundamentals supporting silver prices are fully in place, particularly the continued growth in industrial silver demand in China (focused on high-tech facilities and solar panels) and strong investment demand in India.
It's worth noting that since the Securities and Exchange Board of India (SECI) approved silver ETFs at the end of 2021, India has become a core market for silver ETFs. Data shows that the returns of Indian silver ETFs have surpassed those of gold ETFs. Butler believes that India is the core source of new demand in the silver market and a key driver of this price increase.
He noted that by 2024, silver exchange-traded products in India accounted for 40% of the country's total retail investment demand. This trend continued in 2025, with India's silver imports already reaching a record high. Butler told Investing News Network that ongoing geopolitical conflicts across the globe have not only reinforced silver's safe-haven value as a precious metal but also benefited its industrial properties. As a key strategic metal, silver is indispensable in numerous military applications.
He stressed: "There is a clear correlation between silver prices and the risk of geopolitical conflict."
Of course, rising silver prices also carry significant downside risks: costs for both industrial end-users and consumers will rise. For example, the price of silver has nearly doubled over the past 18 months, directly driving up production costs and potentially leading manufacturers to adjust their production strategies.
But Butler pointed out: "This does not change my long-term judgment on silver. The current supply shortage pattern in the silver market has not changed." He also mentioned that from the production cycle point of view, it takes 10 to 15 years for a new silver mine to be planned and put into production, and it is difficult for the supply side to increase in the short term.
Morgan believes that silver's dual attributes of being both an industrial metal and a precious metal are the core logic behind its success as a high-quality investment. Currently, these two attributes are providing strong support in the silver market. Therefore, when silver breaks through the critical $50 mark, the confidence of ordinary investors in entering and holding on to it will be significantly strengthened.
He said: "No market will rise indefinitely, but I still believe that compared with gold and the stock market, silver's current valuation is still undervalued, and there are multiple positive drivers in the market. If institutional investors and industrial users compete for limited silver inventories at the same time, coupled with the re-entry of public investors, silver prices will still have significant upside potential in the future." However, he believes that in the short term, silver prices will be unlikely to reach $70 or higher, and this goal may take several years to achieve.
I previously asked Morgan and Butler when silver would break through $50. Both Morgan and Butler believed that silver might not break through $50 this year, and that this delay might be more beneficial to the long-term market.
Morgan, a leading figure in the silver market, believes that before breaking through $50, silver prices are likely to experience a "deep market correction," potentially in October of this year. Butler, on the other hand, predicts that a breakout above $50 (what Morgan calls "crossing the Rubicon") may not occur until early next year. Both analysts believe such a correction is crucial, particularly suggesting that silver prices should correct within the $46-$48 range rather than surge directly higher. Butler stated, "For the long-term stability of silver prices, consolidation within this range is far healthier than a surge directly higher."
Silver has now surged past 50 without a significant pullback. As analysts have previously suggested, this rapid rise may have led to a lack of stable trading volume, with both long-term and short-term traders flooding the silver market. This presents a potential risk, potentially leading to a rapid pullback after excessively high sentiment. However, since this recent rally in silver is clearly driven by fundamentals, we anticipate market support for silver prices to remain positive.
(Spot silver daily chart, silver price hits the upper track of the rising channel, triggering a pullback. Source: Yihuitong)
Is this really the case? Isn't there a natural reason for every historical rise? If the silver price stabilizes at $50 this time, what will the market trend be? What are the fundamental differences between the current silver price rise and historical trends? The core difference between this round of silver's push towards $50 and the two previous upward cycles in 1980 and 2011 lies in the strong fundamental support for silver and the structural trend of continued devaluation of fiat currencies.
Supply shortages coupled with investment demand support silver prices above $50
The current driving force behind the silver market has shifted away from frenzied speculation and toward a stronger focus on industrial production. Simultaneously, the expansion of silver exchange-traded funds (ETFs) has significantly broadened investment channels. According to the Silver Institute, industrial silver demand is projected to grow 4% year-over-year in 2024, reaching 680.5 million ounces. While industrial demand is projected to remain flat in 2025, it will account for 59% of total silver demand for the year. Of this total, the solar energy sector is projected to consume 195.7 million ounces of silver in 2025. A July report from the Silver Institute indicates that net inflows into silver exchange-traded products (ETPs) reached 95 million ounces in the first half of 2025, already exceeding the total inflow for the entire year of 2024.
As of October 7th, the iShares Silver Trust (ARCA:SLV), the world's largest silver ETF, has seen a year-to-date gain of over 60%. This performance reflects a trend of investors shifting their allocations to safe-haven assets. For years, silver mine production has lagged behind demand growth. Metals Focus predicts that by 2025, the silver market will face one of the largest supply deficits on record, reaching a projected 187.6 million ounces.
Breaking through $50 has strategic significance but also leads to market divergence
This significant supply gap has led many silver analysts to predict a breakout and sustained hold of the $50 mark. However, can the market effectively stabilize above $50? What market reactions will silver trigger once it breaks through $50? In an October interview with Investing News Network (INN), David Morgan, publisher of The Morgan Report, explained the strategic significance of silver reaching $50, calling this breakthrough "a critical Rubicon crossing" for silver. (Note: "Crossing the Rubicon" refers to the initiation of an irreversible trend.)
He pointed out, "From a market psychology perspective, silver has never broken through the $50 mark and effectively held steady in the past 50 years." He believes that a breakout above $50 is feasible, which would not only have a profound impact on the psychology of silver investors but also influence the automated algorithms currently used in silver futures trading, ultimately potentially pushing silver prices into an "unimpeded upward trend" (a.k.a., a "blue ocean market"). Analyzing from the perspective of investor psychology, Morgan believes that once silver prices reach $50, a clear divergence in the market will emerge: bullish investors believe silver will begin a trend upward, while bearish investors worry that prices will repeat historical mistakes and experience a deep correction.
He explained to the Investment News Network: "So what range will the real trend be in? My core job is to help more investors who want to understand the potential market and judge the price peak to sort out the logic." "No one can accurately predict the peak in advance, but I am convinced that the current market psychology is supportive of silver's upward trend."
Independent precious metals analyst Ted Butler agrees with Morgan's market assessment. In an October interview with Investing News Network, Butler stated that he had not anticipated silver's rapid ascent to $50, and that the speed of the upward movement made him question the sustainability of the rally. "But I firmly believe that silver will eventually break through $50," he said. In Butler's view, $50 is the critical point at which silver will garner significant attention from mainstream media. Once this level is broken, the silver market will enter a phase of public participation, with ordinary investors gradually entering the market.
Spot premium may trigger a rush to buy physical silver
Butler added, "At that point, retail investor buying will combine with the already accumulating institutional demand to further push prices higher." From a technical perspective, Butler believes the silver market is already experiencing backwardation (a phenomenon where futures prices are lower than spot prices), signaling a breakout above $50. This backwardation could trigger a rush to buy physical silver, with investors even opting to withdraw their holdings in the iShares Silver Trust (SLV). A surge in withdrawals of physical silver, already in short supply, could trigger a significant price surge.
How to push silver to stabilize above $50?
Morgan said that in order to break the historical callback curse and allow silver prices to form a sustained trend above $50, silver prices must first complete the callback and build a stable consolidation range near the strong support level.
This correction and consolidation will allow silver prices to continue their upward trend "with a more certain rhythm." Structurally, the fundamentals supporting silver prices are fully in place, particularly the continued growth in industrial silver demand in China (focused on high-tech facilities and solar panels) and strong investment demand in India.
Silver's dual attributes support strengthening
It's worth noting that since the Securities and Exchange Board of India (SECI) approved silver ETFs at the end of 2021, India has become a core market for silver ETFs. Data shows that the returns of Indian silver ETFs have surpassed those of gold ETFs. Butler believes that India is the core source of new demand in the silver market and a key driver of this price increase.
He noted that by 2024, silver exchange-traded products in India accounted for 40% of the country's total retail investment demand. This trend continued in 2025, with India's silver imports already reaching a record high. Butler told Investing News Network that ongoing geopolitical conflicts across the globe have not only reinforced silver's safe-haven value as a precious metal but also benefited its industrial properties. As a key strategic metal, silver is indispensable in numerous military applications.
He stressed: "There is a clear correlation between silver prices and the risk of geopolitical conflict."
Downside risks and supply-side constraints: Short-term cost pressures are unlikely to reverse long-term shortages
Of course, rising silver prices also carry significant downside risks: costs for both industrial end-users and consumers will rise. For example, the price of silver has nearly doubled over the past 18 months, directly driving up production costs and potentially leading manufacturers to adjust their production strategies.
But Butler pointed out: "This does not change my long-term judgment on silver. The current supply shortage pattern in the silver market has not changed." He also mentioned that from the production cycle point of view, it takes 10 to 15 years for a new silver mine to be planned and put into production, and it is difficult for the supply side to increase in the short term.
Morgan's view: Silver valuation is still undervalued, and long-term upside potential is expected
Morgan believes that silver's dual attributes of being both an industrial metal and a precious metal are the core logic behind its success as a high-quality investment. Currently, these two attributes are providing strong support in the silver market. Therefore, when silver breaks through the critical $50 mark, the confidence of ordinary investors in entering and holding on to it will be significantly strengthened.
He said: "No market will rise indefinitely, but I still believe that compared with gold and the stock market, silver's current valuation is still undervalued, and there are multiple positive drivers in the market. If institutional investors and industrial users compete for limited silver inventories at the same time, coupled with the re-entry of public investors, silver prices will still have significant upside potential in the future." However, he believes that in the short term, silver prices will be unlikely to reach $70 or higher, and this goal may take several years to achieve.
What is the future trend of silver?
I previously asked Morgan and Butler when silver would break through $50. Both Morgan and Butler believed that silver might not break through $50 this year, and that this delay might be more beneficial to the long-term market.
Morgan, a leading figure in the silver market, believes that before breaking through $50, silver prices are likely to experience a "deep market correction," potentially in October of this year. Butler, on the other hand, predicts that a breakout above $50 (what Morgan calls "crossing the Rubicon") may not occur until early next year. Both analysts believe such a correction is crucial, particularly suggesting that silver prices should correct within the $46-$48 range rather than surge directly higher. Butler stated, "For the long-term stability of silver prices, consolidation within this range is far healthier than a surge directly higher."
Silver has now surged past 50 without a significant pullback. As analysts have previously suggested, this rapid rise may have led to a lack of stable trading volume, with both long-term and short-term traders flooding the silver market. This presents a potential risk, potentially leading to a rapid pullback after excessively high sentiment. However, since this recent rally in silver is clearly driven by fundamentals, we anticipate market support for silver prices to remain positive.
(Spot silver daily chart, silver price hits the upper track of the rising channel, triggering a pullback. Source: Yihuitong)
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
