Silver Crosses Rs 3 Lakh: Silver has crossed the Rs 3 lakh mark for the first time in India, grabbing all the attention and raising a key question for investors: Is this rally driven by fundamentals or speculation,
and what should one do at these levels? Here’s what experts say:
Why silver prices have surged
According to Aamir Makda, Commodity & Currency Analyst, Choice Broking, silver’s rally is not a sudden spike but an extension of last year’s momentum. “As of mid January-2026, Silver has delivered nearly 30% returns, mounting on the momentum of 2025. Silver has reached to $93 an ounce, a level once considered unthinkable, driven by a ‘perfect storm’ of industrial scarcity and geopolitical shifts.”
Unlike gold, silver today is as much an industrial metal as a precious one. Makda explains that silver demand is being powered by three major technology trends: rapid expansion of solar photovoltaic capacity, rising use in electric vehicles, which consume far more silver than conventional cars, and growing requirements from AI and data centres that rely on silver-based components. At the same time, supply is struggling to keep up.
“Global deficit of Silver has been projected to ~230 million ounce so far in 2026,” he said, pointing to China’s strict export licensing, limited mining growth, and sharply falling inventories.
Geopolitics and safe-haven demand
Geopolitical tensions have added another layer to silver’s appeal. Renisha Chainani, Head–Research at Augmont, noted that both gold and silver touched record highs as investors rushed into safe havens. “Gold and silver climbed to fresh record highs, with gold touching $4,698 (~Rs 1,45,500) and silver reaching $94.36 (~Rs 3,01,300), as investors rushed into safe-haven assets amid a sharp escalation in geopolitical tensions.”
She said the trigger was fresh tariff threats by US President Donald Trump against European countries, alongside elevated risks linked to Iran and the ongoing Russia-Ukraine conflict. These developments weakened risk assets and pushed investors toward precious metals.
Makda added that macro factors such as expected interest rate cuts and geopolitical stress in Iran and Venezuela have strengthened silver’s safe-haven appeal. He also highlighted a key market signal: “The notable decline in the gold-to-silver ratio signals a potential bullish trend for silver in the coming years. Gold/Silver ratio has declined to its historical average mark i.e. 50:1 as on date.”
What technical indicators are saying
While fundamentals remain supportive, experts are flagging short-term caution. Makda pointed out that technical charts show early warning signs. “We have observed a RSI bearish divergence on Daily charts which is a classic ‘Red flag’ warning… Along with this, we can see the fall in OI levels… which suggests a Long unwinding in Silver. Traders who already have long position, should look for a profit-booking at current levels.”
Chainani also highlighted near-term levels to watch. “Silver has touched the 61.8% Fibonnicci resistance target of $93 (~Rs 300,000). Next level to watch for is 78.6% Fibonnici extension of $99.2–100 (~Rs 320,000) and 100% fibonnicci extension of $107 (~Rs 340,000). Strong support lies at $86.5 (~Rs 285,000).”
She added that while physical tightness is showing early signs of easing, speculative appetite, especially in China, remains strong, keeping volatility high.
How should retail investors approach silver now?
For long-term investors, silver’s role may be less about timing the peak and more about portfolio balance. Vishal Kapoor, CEO, Bandhan AMC, said access and structure matter as much as price. “Gold and silver can play a meaningful role in portfolio diversification, but the way investors access these assets matters. Physical metal often brings uncertainties around purity, making charges, storage, and resale… The Fund of Fund (FoF) structure removes barriers… and enables disciplined investing through SIPs.”
Silver’s move beyond Rs 3 lakh reflects a rare convergence of strong industrial demand, tight supply, and heightened geopolitical risk. While the broader trend remains bullish, experts caution that sharp swings are likely at these elevated levels. For investors, silver may still have a place, but preferably as part of a diversified portfolio and with an eye on volatility rather than chasing prices blindly.
Experts believe silver’s importance will continue to grow in the coming years. Expanding solar energy projects and the rapid growth of electric vehicles are expected to push industrial demand even further. In response, the government has emphasised the need to boost domestic production and promote recycling of old silver. Although these measures may reduce import dependence to some degree, India is likely to remain reliant on silver imports for the foreseeable future.
