Silver Price Forecast: Silver Surges 7% in a Single Day, Will the Market Hit a New Record High?

Latest reports indicate that Peru, one of the world's major silver production hubs, issued an energy emergency decree on May 11. Although the decree targets Peru's energy supply, it highlights tight domestic energy availability, where energy, fuel, and transportation costs directly impact mining, mineral processing, and logistics.

In terms of silver supply and demand, Peru occupies a critical position in global supply. In 2025, Peru's silver production reached approximately 3,600 tons, accounting for about 13.6% of global silver mine output, and it remains one of the countries with the world's largest silver reserves.

More importantly, the silver market is currently in a state of supply deficit. According to a Reuters report, the global silver market deficit is projected to widen to 46.3 million ounces in 2026, up from 40.3 million ounces in 2025. While total demand is expected to drop by 2%, physical investment demand is forecast to grow by 20%, hitting a three-year high. The Silver Institute has offered a similar assessment, noting that silver investment demand will rise in 2026, while incremental gains in mine production and recycling remain limited, leaving the market deficit intact.

TradingKey believes that Monday's surge in silver prices was likely due to the market interpreting policy moves as a sign of rising mining operating costs and reduced supply elasticity. This directly reinforced expectations of a supply contraction, driving the rally in silver prices.

Meanwhile, China's Ministry of Foreign Affairs announced that Trump will visit China from May 13 to 15. Several executives from major U.S. corporations will accompany Trump on the trip, which is viewed as high-level economic diplomacy centered on trade, investment, and commercial cooperation.

According to a Reuters report, Trump has scheduled meetings with Chinese leadership in Beijing, and the market is already pricing in the possibility of a marginal easing in U.S.-China relations.

For silver, Trump's visit to China also represents a significant tailwind. Silver is not just a precious metal; more crucially, it is also an important industrial metal widely used in electronics, photovoltaics, and manufacturing chains. As long as U.S.-China economic and trade relations improve and expectations for industrial activity rebound, silver often reacts more rapidly than gold.

According to the silver daily chart, silver entered a period of sustained correction in February and March of this year, retracing from a high of $121.64 to a low of $61.02—a decline of nearly 50%. Nevertheless, silver prices have remained supported above the 144-day moving average, suggesting that the long-term trend remains potentially bullish.

Silver price daily chart, Source: TradingView

Recently, as the silver price bottoms have gradually risen and prices have consistently held above the 144-day moving average, bullish momentum has been steadily accumulating. Furthermore, market bullishness was significantly bolstered following Monday's breakout above the April 17 high of $83.05.

At present, the March 2 high of $96.39 serves as a critical resistance level for silver prices. A decisive breakout above this point would further open the door for additional upside.

Simultaneously, the candlestick structure has formed the left shoulder ($64.10) and head ($61.02) of a head and shoulders bottom. If the $96.39 neckline is breached, followed by a pullback to form a right shoulder that remains above $64.10, the head and shoulders bottom pattern will be confirmed. This could lead silver to potentially surpass $121.64 and reach a new all-time high.

This content was translated using AI and reviewed for clarity. It is for informational purposes only.