Silver Surge Could Unleash Gold Price Rally, Goldman Sachs Warns

Goldman Sachs is warning of an impending surge in gold prices driven by an unusual increase in silver call option buying. Traders are betting that silver will hit $90 per ounce, a level it briefly touched earlier this year. With silver currently trading at around $69.40, a 30% gain would represent a significant move. Goldman emphasizes that the liquidity profile of the silver market amplifies these moves due to its relatively small size.

The bank notes that the concentration of call buying at the $90 strike is telling. This self-reinforcing cycle creates a feedback loop where market makers who sell those calls need to hedge their exposure by buying the underlying asset, pushing prices higher and making the calls more valuable. As precious metals tend to move in correlation, aggressive silver positioning tends to drag gold along for the ride.

Goldman maintains its end-of-2026 gold targets between $4,900 and $5,400 per ounce and projects average silver prices between $85 and $100 in 2026. Citi is also singing a similar tune, reiterating its silver forecast with near-term and six-to-twelve-month targets of $75 and $90, respectively.