Gold and Silver Open 2026 With Gains Following Huge Annual Surge

Gold and Silver Performance in 2026

Gold and silver opened 2026 with gains, continuing their strong performance from 2025. The bullion rose toward $4,350 an ounce, while silver gained more than 1%. The metals saw their best annual performance since 1979.

Traders have noted that gold and silver are well-positioned for further gains in 2026, supported by expected U.S. interest-rate cuts and a weaker dollar. However, there are near-term concerns about portfolio index re-balancing that could pressure prices.

The recent rally has led to increased presence of the metals in indices, potentially exceeding target allocations. This has prompted passive tracking funds to consider selling some contracts according to market analysis.

Analysts anticipate a significant sell-off in the Comex silver market. Daniel Ghali, a senior commodity strategist at TD Securities, wrote in a note that 13% of aggregate open interest in Comex silver markets may be sold over the next two weeks, leading to a dramatic repricing lower.

Gold gained 0.7% to $4,348.42 an ounce at 8:00 a.m. in Singapore. The Bloomberg Dollar Spot Index remained flat. Silver advanced 1.5% to $72.7175. Other precious metals like palladium and platinum also rose, gaining nearly 2% each.

Market activity may be thin on January 1 due to holidays in major markets such as Japan and China. This could affect trading volumes and market liquidity.

Why Did This Happen?

The strong start to 2026 for gold and silver is attributed to ongoing interest-rate cuts and a weaker U.S. dollar. Lower interest rates reduce the cost of carrying non-yielding assets like gold and silver, making them more attractive to investors.

Central bank purchases and inflows to exchange-traded funds have also supported the rally. These factors have contributed to the best annual performances for the metals since 1979.

However, the metals' presence in indices has raised concerns. Passive tracking funds may need to rebalance their holdings, potentially leading to sell-offs.

What Are Analysts Watching Next?

Analysts are closely watching for signs of portfolio rebalancing and potential sell-offs in the silver market. TD Securities' prediction of a 13% sell-off in Comex silver markets is a key indicator of near-term market pressure.

The technical indicators for silver are showing signs of an overbought market. This has led to tighter margin requirements in some exchanges, adding pressure on traders who may need to close or reduce positions.

Chinese investor interest has been a key driver of silver prices. Elevated buying in the Shanghai Gold Exchange pushed premiums to record levels. The surge in interest led to the country's only pure-play silver fund turning away new customers.

How Did Markets React?

Despite the recent volatility, gold and silver remain on track for their best annual performances since 1979. The metals have benefited from strong central-bank purchases and inflows to ETFs according to market reports.

Silver saw a significant price reversal after reaching a record high of $84 an ounce, before dropping close to $70. This volatility has prompted exchanges to raise margin requirements for certain Comex silver futures contracts.

The London market experienced a full-blown squeeze in October as flows into ETFs and exports to India reduced already low inventories. While there have been significant inflows since then, much of the world's available silver remains in New York warehouses.

The U.S. Section 232 probe into critical minerals could also impact the silver market. Potential tariffs or trade restrictions could affect global supply dynamics.