Although the silver market is expected to see a sixth consecutive year of annual supply deficit, one market strategist believes this may not be enough to push silver prices back to their January all-time highs.
In his latest report on silver, Mike McGlone, senior market strategist at Bloomberg Intelligence, reiterated his relatively mediocre expectations for the precious metal. He stated thatsilver prices could "meander for years" between $50 and $100.
McGlone made the above comments as silver was struggling to sustain a break above initial resistance at $80.
While McGlone did not rule out the possibility of silver retesting the $120 high set in January, he noted that rising prices would lead to a fundamental shift in supply-demand dynamics.He stated: "A key takeaway is that the supply deficit will change due to this parabolic price adjustment,and the market could transition into a phase of high-price-driven demand destruction."
McGlone noted that silver's current trajectory resembles parabolic fluctuations seen in other periods. He explained that silver's rally, which began in mid-2025, reached a premium of 2.6 times its 10-year moving average at its peak, strikingly similar to the last parabolic move in 2011.
McGlone stated: "We see parallels. Silver was around $79 on April 15,and silver appears set for a prolonged stagnation between $50 and $100.Given the risk of mean reversion, the probability of silver pulling back toward its 10-year moving average near $33 is greater than the probability of it staying above $100."
Meanwhile, McGlone reminded investors that silver's 180-day volatility is more than five times that of the S&P 500. This reading reached its highest level since 1980, when silver topped just below $50 — a high that was matched in 2011 and not surpassed until 2025.
Looking ahead, McGlone believes thatif the trend reverses, silver could retrace to $50.
McGlone's bearish expectations come as the market digests the Silver Institute's annual report, which forecasts this year's annual silver deficit at 46.3 million ounces.However, as silver consumption in PV solar cell panels is expected to decline by 19%, industrial demand this year is expected to fall by 3%.
Metals Focus, the research firm responsible for the survey, expects investment demand to be the biggest driver of the silver market this year. The survey showed that, driven by 30 mt of physical inflows into silver exchange-traded products (ETPs), silver investment demand is expected to grow by 18% this year.
