These Breakouts Are Coming

Is silver about to break out?

For more than a year, we’ve been tracking the horse race between gold and silver, flagging which metal appeared better suited for outperformance due to the gold-to-silver ratio.

The quick recap: In early 2025, with the gold-to-silver ratio above 105, silver was deeply undervalued. We flagged its asymmetric upside, and between July 25 and January 15, silver exploded 137% while gold climbed a respectable 37%.

Then, with silver’s explosive run having reset the ratio to around 51 – its lowest since 2012 – we flipped the script and said gold was the better bet. Sure enough, gold outperformed as the ratio climbed back toward equilibrium.

When we last checked in on April 23, the ratio sat near 61 – squarely in the middle of its historical range. That resulted in the following takeaway:

With the gold-to-silver ratio back to equilibrium, there’s no lopsided imbalance that tips the odds squarely in one camp.

Sure enough, since then, there’s been no breakout performance either way. Both gold and silver have drifted slightly lower, so the gold-to-silver ratio is roughly 60.

But if Senior Analyst Brian Hunt is right, there’s a different potential catalyst racing toward us that could send silver higher…

The fundamental case for silver
Brian, editor of the free daily e-letter Money & Megatrends, has been long and bullish silver for years – both for its dollar-debasement hedge properties and what he calls its “high-tech tailwind.”

From Brian:

Silver has the highest electrical and thermal conductivity of any metal. This makes it a critical component in AI infrastructure, solar energy systems, and other electrical systems.

That structural demand story hasn’t changed. If anything, it’s deepening.

Brian notes that as AI moves toward “the edge” – running on local devices like phones, cars, robots and satellites – the performance demands on electrical components tighten:

These systems don’t just demand more electrical performance — they demand better electrical performance within increasingly tight thermal and power constraints.

Every watt matters. Every degree of heat matters.

Silver is present across every critical piece of that infrastructure.

Meanwhile, the supply picture remains structurally constrained…

According to the 2025 World Silver Survey, cumulative market deficits since 2021 have reached roughly 680 million ounces. And roughly 80% of silver is mined as a byproduct of base metals – meaning higher prices alone can’t simply call more supply into existence.

As Brian puts it:

The market cannot drill its way out of a silver shortage.

“But why now?”
As we walked through earlier, the gold-to-silver ratio remains in relative equilibrium today.

So, what’s the catalyst that could send silver higher?

Here’s Brian:

The chart below shows how, over the past few months, silver has traded in what I call a “compression pattern.”

Its recent range of highs and lows is tighter than that which preceded it.

Such compression patterns often lead to strong moves in the direction of the primary trend.

For broad exposure, the iShares Silver Trust (SLV) is your simplest play – it’s the largest physically backed silver ETF with over $40 billion in assets.

If you want a more concentrated bet, Brian highlights Pan American Silver (PAAS) – the world’s largest silver-focused producer, with 10 mines across the Americas and $1.3 billion in cash on the balance sheet.

I’ll throw in a fun wrinkle before we move on…
Guess what’s also in its own compression pattern?

You guessed it – gold.

Are we on the verge of a jump in both silver and gold, which would effectively mean the gold-to-silver ratio remains in rough equilibrium?

It’s certainly possible. And if both metals move together, the gold-to-silver ratio stays roughly where it is, which would make the size of the move more important than which metal you own.

— Jeff Remsburg

Source: Investor Place