The Never-Ending Gold and Silver Rally – $5,000 and Beyond

On Jan. 26, Wall Street woke up to gold and silver prices reaching another record high. The yellow metal topped $5,000 per ounce for the first time, while silver continued firming above $100. It has been an exceptional journey for precious metals, especially for investors who bought them for a couple of raspberries and a vanilla shake back in the day. What is this unprecedented rally saying?

Gold and Silver to the Moon

During the pandemic-era meme-mania, armchair traders insisted that AMC, dogecoin, and GameStop would go to the moon. Years later, these investments are in the doldrums. Instead, the good old-fashioned hard assets are all the rage, leaving cryptocurrencies and stocks eating their mining dust.

Over the last 12 months, gold and silver have climbed 86% and 280%, respectively. Nobody anticipated this meteoric ascent; not even the goldbugs saw this coming. But what has been the driving factor behind this never-before-seen rise?

For gold, it is a mix of investor demand, a weaker US dollar, central bank buying, and traders chasing the rally. The greenback has slumped over the past year, falling around 8%, making dollar-denominated commodities cheaper and more appealing to foreign investors. Central banks continue to buy the metal, with Goldman Sachs estimating purchases averaging 60 tons per month, well above the pre-2022 average of 17 tons.

For silver, it is primarily the global supply deficit. The federal government added the white metal to its list of critical minerals this past fall. Big Tech (at home and abroad) needs industrial metals for the buildout of artificial intelligence (AI), data centers, and robotics. The other factor for silver is China. The Chinese Communist Party imposed export controls on silver, and companies now require government licenses to export it.

In Shanghai, silver premiums are $16. In Dubai, they touched $40. Why? The people want the physical stuff, not the metals on paper. On the COMEX division of the New York Mercantile Exchange, the paper-to-physical ratio in silver is about 350:1 – for every ounce of deliverable silver, there are 350 ounces of paper claims.

Toss in geopolitical tensions, fiscal fears, economic uncertainty, and the rally extending beyond traditional channels, and the manic metals trade still has plenty of room to grow.

Death of the Dollar

Traversing through X will deliver a plethora of theories that the latest trip to the moon aboard the Goldfinger Express is signaling the death of the US dollar. Put simply, the world wants real money, not the phony paper kind.

On the surface, this appears to be a reasonable assumption inside the social media ecosystem. Indeed, the dedollarization has been much discussed over the past decade. But it has also been said that dethroning King Dollar is a multi-decade coup rather than an overnight stunt.

Central banks have a fierce appetite for gold because they want to diversify their foreign reserves. Demand for silver is going through the roof because it has quickly become a critical asset. Investment funds are adding to their gold holdings because that is what their clients want. Retail is diving into the metals market because that is what they do whenever a red-hot trade emerges.

If it were solely about conducting a monetary regime change in the world order, the only metal that would rocket would be gold. Instead, Dr. Copper has surged more than 40% since January 2025, reaching $6 per pound. Palladium has advanced 123% to nearly $2,200 per ounce. Platinum has soared nearly 200% to $2,800 an ounce. All these metals have the same thing in common: industrial use.

After years of being undervalued, gold and silver pricing is being rebased, according to a December 2025 JPMorgan Chase research note. “While this rally in gold has not, and will not, be linear, we believe the trends driving this rebasing higher in gold prices are not exhausted,” said Natasha Kaneva, head of Global Commodities Strategy at JPMorgan. “The long-term trend of official reserve and investor diversification into gold has further to run. We expect gold demand to push prices toward $5,000/oz by year-end 2026.”

Having Fun

Whether you have been holding Fartcoin and missed the metals train, or you have been sitting in gold and silver since 1987’s Black Monday meltdown, this has been a fun and unpredictable ride. One day, it will come to a screeching halt, comparable to the GameStop fiasco a few years ago. Until then, put on your white gloves, shine your metals, and bask in their shine.

Could gold hit $5,500? Could silver touch $150? Perhaps by the time you read this, these milestones could be reached.