Silver futures hit a new record high on Tuesday, breaking through the $88 per ounce mark during trading, and it looks like it will soon follow the historical closing price record. Even more interesting is that this rally occurred after the exchange announced adjustments to margin requirements.

Last Monday, the exchange group issued a notice deciding to increase the margin ratios for precious metals futures such as silver, gold, platinum, and palladium—requiring investors to pay a higher proportion based on the nominal value of the futures contracts. This adjustment officially took effect from Tuesday's close.

Generally speaking, raising margin thresholds would suppress trading enthusiasm, but the market doesn't seem to buy it. Silver prices not only did not retreat but continued to surge upward, indicating a very strong bullish sentiment towards precious metals.