Gold, Silver Rebound Sharply After Panic-Led Sell-Off

After three straight sessions of heavy selling that rattled bullion traders, gold and silver prices staged a sharp recovery, snapping a brutal losing streak. The bounce was swift and decisive. Silver futures surged nearly 6% on MCX, reclaiming the psychologically important ₹2.5 lakh per kilogram level, while gold futures climbed around 3%, tracking a similar rebound in global markets.

The move brought immediate relief to traders who had watched prices slide relentlessly, wiping out weeks of gains in a matter of days. More importantly, it reopened the debate: was the recent fall an overreaction, or just a pause before deeper pain?

What Triggered the Three-Day Rout in Precious Metals?

The recent sell-off was not driven by a single headline. It was a stacking of pressures, all hitting at once. First came global monetary policy nerves. Renewed speculation around US interest rate direction and Federal Reserve leadership hardened the dollar, which typically weighs on precious metals priced in dollars.

At the same time, margin requirements were raised on the CME, forcing leveraged traders  especially in silver to cut positions aggressively. This triggered forced selling, stop-loss hits, and panic unwinding.

Silver, already stretched after a sharp rally earlier, took the hardest hit. At its worst, MCX silver had corrected over 40% from recent highs, a move that shocked even seasoned commodity desks. Gold followed, though with relatively less damage.

Why Did Prices Bounce Back So Strongly?

The rebound didn’t come out of thin air.

By the third day of selling, both gold and silver had entered deeply oversold territory, technically and sentiment-wise. Traders who missed earlier rallies saw value emerging near long-term support zones. Short sellers rushed to book profits. Long-term participants stepped in quietly.

Globally, spot silver jumped close to 6%, while spot gold rose around 3–4%, confirming that the bounce was not India-specific but part of a broader corrective move.

In simple terms, the market moved from fear to balance at least for now.

Key Technical Levels Traders Are Watching

This bounce matters because it occurred near critical price zones:

Silver

• Global support: Near $65 per ounce

• MCX support: ₹2,28,000 – ₹2,21,000 per kg

• Immediate resistance: ₹2,47,000 – ₹2,61,000 per kg

Gold

• Global support: Near $4,440 per ounce

• MCX support: ₹1,40,000 – ₹1,36,600 per 10 grams

• Resistance zone: Around ₹1,52,000 per 10 grams

These levels will decide whether the rebound matures into a trend or fades into another volatile swing.

Should Investors Buy Gold and Silver at Current Levels?

This is where caution replaces excitement.

Market experts broadly agree on three things:

1. The panic phase appears to be over, at least in the short term.

2. Downside risk has reduced near current support zones, making selective buying possible.

3. Volatility remains elevated, and sharp intraday swings are still likely.

For short-term traders, buying near support with strict stop-losses makes sense.
For long-term investors, staggered accumulation not lump-sum buying is the safer approach.

The broader trend will still depend on global cues: US interest rates, dollar movement, inflation signals, and geopolitical risks.

What’s Happening in the Physical Market?

Physical bullion prices reflected the futures rebound, though demand remains measured.

• Gold (22K) traded near ₹1.12 lakh per 8 grams in major cities

• Gold (24K) hovered around ₹1.22 lakh per 8 grams

• Silver prices firmed up across wholesale markets after days of hesitation

Jewellers report cautious buying more inquiry than commitment a sign that retail participants are waiting for stability before stepping in.

Bigger Picture: Trend Change or Temporary Relief?

This rebound does not yet confirm a fresh bull run. What it does confirm is that the market punished excess speculation and is now searching for fair value.

Gold remains supported by long-term themes like central bank buying and geopolitical uncertainty. Silver, being more volatile and industrially linked, will continue to swing harder in both directions.

For now, the market tone has shifted from panic to pause.

Bottom Line

Gold and silver have bounced hard after a steep and uncomfortable fall. The recovery is real, technically justified, and backed by global price action. But it comes with a warning label.

This is a stabilisation phase, not a green signal for reckless buying.

Discipline, position sizing, and patience will matter more than prediction from here.