Silver futures climbed more than 1% on Friday morning to breach $93 per ounce, extending the precious metal's extraordinary start to 2026 and leaving market observers wondering just how high the rally can go.

The move comes as investors increasingly turn to precious metals amid a confluence of uncertainties: questions about Federal Reserve independence, geopolitical tensions involving Iran and Greenland, and the approaching anniversary of President Trump's second inauguration on January 20.

Why Silver Is Outshining Gold

While gold retreated slightly from its own record high near $4,641 per ounce, silver's surge underscores a notable divergence between the two precious metals. Several factors are driving silver's outperformance:

  • Industrial demand: Unlike gold, silver has substantial industrial applications, particularly in solar panels and electronics. The ongoing AI infrastructure buildout is driving increased demand for silver in specialized components.
  • Relative value play: The gold-to-silver ratio remains historically elevated, suggesting silver has room to catch up. Many traders view current prices as still undervalued relative to gold.
  • Smaller market size: Silver's smaller market capitalization means investment flows can move prices more dramatically than in gold markets.

The $100 Milestone in Sight

With silver now trading above $93, the psychological $100 barrier has become the next major target for bulls. Some analysts believe the milestone could be reached within the first quarter of 2026 if current momentum persists.

"Silver has been the standout performer in commodities this year. The combination of safe-haven demand and structural industrial demand creates a compelling case for continued strength."

— Precious metals strategist at a major Wall Street firm

What's Driving the Safe-Haven Trade

Several factors are pushing investors toward precious metals as 2026 begins:

Federal Reserve uncertainty: The Department of Justice investigation into Fed Chair Jerome Powell has raised unprecedented questions about central bank independence. While major Wall Street figures, including JPMorgan CEO Jamie Dimon, have publicly defended Powell, the uncertainty is pushing some investors toward hard assets.

Geopolitical risks: Trump's comments about Iran and Greenland have added to an already tense global backdrop. Although oil prices fell sharply this week on hopes of de-escalation with Iran, precious metals traders remain cautious.

Inflation hedging: The Fed's Beige Book this week showed that tariff-related cost pressures are increasingly being passed through to consumers. Investors seeking protection against potential inflation resurgence are adding precious metals exposure.

Investment Considerations

For investors considering silver exposure, there are several avenues:

  • Physical silver: Coins and bars remain popular among retail investors, though premiums over spot prices can be substantial.
  • Silver ETFs: Funds like the iShares Silver Trust (SLV) offer liquid exposure to silver prices without storage concerns.
  • Mining stocks: Silver miners offer leveraged exposure to metal prices, though they come with company-specific risks.

Risks to Watch

Despite the bullish momentum, silver investors should be aware of potential headwinds:

A sudden de-escalation in geopolitical tensions could reduce safe-haven demand. Additionally, if the Federal Reserve maintains a more hawkish stance than expected, rising real yields could pressure precious metals. Silver's industrial demand component also means it's more sensitive to economic slowdown concerns than gold.

Still, with markets closed Monday for Martin Luther King Jr. Day, traders have an extended weekend to digest the week's events—and silver's record run—before returning to action on Tuesday.