On January 30th the price of silver ($965310) (-3.11%) crashed over 30% in one day. Since then the price has been relatively flat (but still volatile). Does that mean the end of the historic silver squeeze that was happening? In my opinion it does not and here are three reasons why I think silver could soon start a new leg up.

1. Physical Drain Is Breaking the Paper Market

The crisis in physical silver is no longer theoretical. In just seven days in January 2026, 33.45 million ounces were physically withdrawn from COMEX, roughly 26% of registered inventories vanishing in a single week. Meanwhile, COMEX carries 366 million ounces in open interest contracts for March delivery but holds only 102 million ounces available to settle them. The LBMA's eligible silver stocks have shrunk to approximately 155 million ounces against annual floating demand of 900 million to 1.2 billion ounces. The Shanghai exchange only holds 25 million ounces.

Sprott's data shows the cumulative physical deficit from 2021–2025 totals nearly 800 million ounces. Mine supply has actually declined 7% since 2016, meaning this gap is structural, not cyclical. Industrial users are now signing long-term supply contracts directly with miners, bypassing exchanges entirely. We currently see backwardation (spot price higher than futures price) a signal that buyers no longer trust exchange delivery.

2. China's Export Licensing: The Supply Shock Nobody Was Ready For

Starting January 1, 2026, China replaced its silver export quota system with a strict licensing regime. Only 44 companies have been authorized to export silver globally for 2026–2027. To qualify, an exporter must produce at least 80 tonnes annually and maintain $30 million in credit lines, instantly eliminating hundreds of small and mid-sized suppliers.

The practical effect: China has cut off 60–70% of globally tradable silver supply. This mirrors China's rare earth playbook, first dominate production, then weaponize export controls for geopolitical leverage. The U.S. government, recognizing the strategic dimension, designated silver as a critical mineral in November 2025.

3. The 356:1 Paper-to-Physical Ratio: A Mathematical Impossibility

The most explosive catalyst is the one hiding in plain sight on COMEX's own data: a paper-to-physical ratio of approximately 356:1. For every single ounce of deliverable physical silver in exchange vaults, 356 paper contracts claim ownership of it.​​

This mirrors and even exeeds the conditions that preceded the 1979–1980 Hunt Brothers crisis, when silver briefly hit $50. The critical difference: the 1979 crisis was driven by private speculators who could be stopped by exchange rule changes. Today's squeeze is being driven by sovereign governments draining physical metal into national stockpiles, a force that no exchange rule change can reverse. China and India are buying physical through spot and deferred delivery contracts, and that metal disappears into state vaults and does not return to market.​​ When short sellers on COMEX are forced to deliver metal they do not have, they must buy at any price. That dynamic, once triggered at scale, is what transforms a strong bull market into a historic repricing event.​​

The Gold-Silver Ratio Math

The final piece is simple arithmetic. The historical monetary gold-to-silver ratio averaged 15:1 to 16:1 when both metals functioned as money. With gold currently trading above $4,500 per ounce, a reversion to a 15:1 ratio produces a silver price of $300 per oz. The ratio currently sits near 60:1. The correction, when it comes, tends to be violent and fast.

TLDR;

The market fundamentals didn't change since last year. There is still a fundamental shortage, there is still a possible short squeeze and the gold/silver ratio is still relatively high. All pointing to a significantly higher silver price in the near future.

What are your views on silver? Is the run over, or will we see more explosive price action? I'm still holding on to my position. Are you?

While silver $965310 (-3.11%) has been on a fantastic run this past year, the miners underperformed relative to the silver price.

$SILG (-4.18%) is up 165% this past year, while silver is up 163%. Even though this is a slight outperformance, the expected performance should be way higher.

If we compare that to the gold price (68%) and the gold miners (159%) we see the miners grew exponentially more than the comodity price.

Why silver miners should outperform the silver price:

• Production costs stayed flat at $18 an ounce.
• With silver at $84 that is a hefty profit margin!
• Profit margins improved from 20% to over 80% since 2024
• Primary silver mines have the advantage over secondary mines (lead,zinc,copper,gold) as they can scale up according to the new silver price
• Q4 results are yet to be released, while Q4 saw the great silver price surge

Why silver miners lagged so far:

• Traders expect the silver price surge to be temporary
• This would drop profit margins as quick as they rose

I expect the silver miners to rise sharply after Q4 results are released. I also expect the silver price to rise even more, improving the profit margins even further. That's why I'm expanding my position in $SILG (-4.18%)

My biggest investment $965310 (-3.11%) is now up over 100% this year (in euros). A big milestone! It hit fresh nominal all time highs in basically all currencies. Does this mean it's overbought?

My thoughts on this are very clear: no. Silver tends to overshoot gold a lot in a bullmarkt, which we are currently in. In previous bull markets the gold silver ratio got as low as 20-30. Right now it's 65. This means silver can still more than double from here, compared to gold. All while gold also rises.

My target is well over €100 per ounce, with a spike possible over €200. I haven't sold any yet. What are your strategies on gold and silver? Are you buying? Or selling?

#silver
$965310 (-3.11%)

$965310 (-3.11%) Silver nears its all time high in dollars. In 1980 it reached $49.95. Then in 2011 it briefly reached $49.50. With silver hovering around $48 we are at a crucial resistance.

Personally I think it's highly likely that this time the $50 mark will be broken. Why?

This is the longest silver has ever been above 40. This time its a gradual increase and not the quick peak we saw in 1980 and 2011.

Also the fundamentals look stronger than ever. Huge industrial demand on top of a monetary crisis. See my previous post for more fundamentals.

What do you think? I'd love to share opinions.

#silver #alltimehigh

Anyone else excited about the recent move in the silver $965310 (-3.11%) price?

Some of the reasons why I'm excited:

• The chart looks a lot like 2008-2010, the first stage for a 500% move
• 5th year of production deficit
• more silver is needed every year for green technologies (solar, EV, electronics)
• solid state batteries will consume a lot of silver
• gold silver ratio is extremely high, silver has to catch up to the price of gold
• high inflation environment with pressure for lower interest rates because of government debt

I'm holding on to my position. Ready for the ride!

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