Silver experiences roller coaster start of 2026: crash, recovery and big questions

‍

The year 2026 started spectacularly for the silver price. After the first month, the precious metal registered an increase of around 75 percent. What followed, however, was pure turbulence comparable to the movements that we also saw on the gold market. We first saw a 49 percent crash in just eight days, followed by a strong recovery of 23 percent. We can say that the new silver trading year has started with an extraordinary amount of fireworks and volatility.

‍

The central question, of course, is what these extreme movements mean for the rest of 2026, so is the bull run permanently over, or will it stay? investing in silver a good idea for the coming months?

Back to basics: why invest in silver?

In times of extreme volatility, it's always wise to take a few steps back, breathe easy, and look at the big picture again. Anyone who does that quickly comes to the conclusion that a large part of the sharp price movements of the past few weeks have probably not been fundamental.

‍

That is to say: the last jump up for silver was probably the result of the huge hype. Many investors who entered at the highest prices probably did not do so because of a deep-seated conviction about the long-term value of silver.

‍

Rather, it was about investors who saw a spectacular increase and, driven by greed, also wanted to participate. Of course, that is not the best reason to to buy silver. In the slightest headwind, enthusiasm often quickly turns into panic in such cases.

‍

At the same time, seasoned investors, who had been steadily building silver for years, took advantage of the euphoria to reduce part of their position. When prices then started falling, the latest entrants fell into uncertainty. That uncertainty turned into panic selling, which ultimately resulted in a sharp correction of almost 50 percent.

‍

Experienced investors buy silver as a base for two reasons:

‍

1. Inflation protection: like gold, silver offers protection against monetary depreciation thanks to its natural scarcity.
2. Protection against geopolitical uncertainty: for silver, it is irrelevant whether America or China is the world leader of the future. It is a politically and economy-independent asset, in contrast to stocks. Apple and Tesla would be struggling if China rules the geopolitical world stage in the coming decades, silver isn't. This makes precious metals extra attractive for investors in times of uncertainty.
3. Increasing industrial demand: silver is an essential raw material for electronics and computer chips, and plays an important role in the AI revolution, for example. The energy transition is also increasing the demand for silver. In addition to protecting against inflation, the silver price therefore also grows with the economy.

‍

Of course, a rapid rise in the price is no reason to buy silver. Silver is not an asset you should expect miracles from, and seeing them is often a reason to be cautious in the short term. Extreme price explosions are often short-lived and are almost always followed by a sharp decline, as we saw now.

‍

As with any asset for which there is a strong fundamental story, it is also important to step in systematically for silver. This sometimes means you miss out on sharp increases with part of your capital, but you also avoid being the last to enter the top and having to suffer a decline of almost 50 percent.

Silver expectations in the remainder of 2026

Expectations regarding the silver price in the remainder of 2026 are broadly positive. The foundation for silver still remains strong.

‍

1. Geopolitical Uncertainty: for now, there seems to be no end to the geopolitical uncertainty that prevails around the world. Donald Trump continues to surprise. At the time of writing, there are rumours that Russia and the United States are going to work more closely together. Europe shocked earlier, of course, from his threat to invade Greenland, and China is also on several fronts busy to expand its power. There is sufficient uncertainty, which forms an important basis for price increases in politically and economy-independent assets such as silver and gold.
2. Risk of inflation: The fact that more and more countries are realizing that past alliances are worth less also means that everyone will spend more capital. Governments will spend more on defense, which may cause budget deficits to increase and debt creation to achieve those plans. This increases the risk of future inflation, which also benefits silver and gold.
3. AI revolution: in addition, the rise of artificial intelligence is still in full swing. Silver plays an important role in this as a raw material. Industry demand for silver is likely to remain high in the coming decades, which is also a positive factor for silver prices.

‍

Of course, this does not guarantee a higher silver price in 2026, but it does lay a solid foundation. In the short term, forecasting prices in the financial markets remains a difficult game. The only thing you can do as an investor is calmly make a plan for the future, stick to that plan and not act based on emotion.