Market Shock: Sharp Downturn in Precious Metals

On Friday morning trading on India’s MCX, both silver and gold futures plunged sharply, triggering alarm among commodity traders and investors. Silver futures for March 2026 delivery plunged ~6%, tumbling about ₹15,000 to ₹2,29,187 per kg, while gold futures for April delivery slid ~2% to ₹1,49,396 per 10 g, bringing gold below the psychologically important ₹1.5 lakh mark.

This marked the second consecutive session of losses following a global sell-off and renewed strength in the U.S. dollar, which weighed heavily on safe-haven assets.

What Triggered the Drop?

1. Global Tech Sell-Off & Stronger Dollar
A broad weakening in global markets, especially in the technology sector, pushed investors out of risk assets into cash. The U.S. dollar strengthened, making dollar-priced gold and silver more expensive for holders of other currencies, thus reducing demand.

2. Higher Trading Margins on MCX
To curb excessive volatility, the MCX raised margin requirements to 7% for silver and 3% for gold. Higher margins deter leveraged positions and often trigger profit booking or forced unwinding of positions, adding to price pressure.

3. Global Sentiment & Geopolitical Uncertainty
Experts noted that ongoing geopolitical developments, including talks around the U.S.–Iran nuclear deal, could continue adding uncertainty to bullion markets.

How Are International Markets Moving?

Despite weak domestic futures:

• Spot gold in international trade rose slightly (about 0.4%) to around $4,790 per ounce—yet remained down on a weekly basis.

• Spot silver steadied near $71/oz after sharp prior losses.

The contrast between global spot behaviour and domestic MCX futures highlights how currency, speculative positions, and short-term trader actions can amplify moves in India’s commodities market.

Expert Views: Trade With Caution Now

Market commentators argue that volatility remains elevated and technical support levels may be tested:

Support & Resistance Levels (Technical View)

• Gold Support (U.S.): ~$4,770–4,640/oz | Resistance: ~$4,955–5,050/oz

• Silver Support: ~$64–71.20/oz | Resistance: ~$84.40–88.80/oz

• Gold (MCX): Support ~₹1,50,500–1,47,700 | Resistance ~₹1,54,200–1,55,800

• Silver (MCX): Support ~₹2,25,000–2,12,000 | Resistance ~₹2,54,000–2,64,000

Caution Advice: Analysts recommend staying on the sidelines until volatility settles, given rapid swing movements and margin-driven positioning.

Long-Term Perspective: Is This a Normal Correction?

Looking beyond this sharp sell-off:

• Bullion markets were recently at record highs—silver peaked significantly above ₹4 lakh per kg and gold near ₹1.93 lakh per 10 g in late January.

• Historic rallies often lead to profit-taking corrections. Recent market reports show silver plunging more than ₹1.5 lakh from its peaks and gold down tens of thousands of rupees from highs.

Commodity markets like equities experience cycles of rapid gains, profit booking, and consolidation. This sharp drop appears consistent with that pattern.

🏦 Physical Gold Rates (India)—Key Consumer Prices

At the time of writing, approximate physical market rates for 22- and 24-carat gold are:

Note: Physical rates may vary by jeweller premiums and local supply/demand conditions.

Should You Buy the Dip?

Bullion Investing View Near Term:

• High Risk, High Volatility: Not ideal for aggressive or leveraged positions right now.

• Trade Only with a Clear Strategy: If entering futures, use strict stops.

• Wait for Stability: Many experts prefer waiting for clear directional signals.

Long-Term Investors:
Silver and gold still possess safe-haven appeal, especially as hedges against inflation and geopolitical risk but timing matters.

Why It Matters Today

The sharp fall in gold and silver prices comes at a time when Indian markets are already grappling with heightened volatility across equities, currencies, and global commodities. For traders, the sudden spike in margin requirements and rapid price swings increase near-term risk, forcing more disciplined position sizing. For long-term investors, the move tests conviction after a record-setting rally in bullion, highlighting how quickly sentiment can turn when global cues, dollar strength, and policy actions collide. Today’s correction is less about fundamentals breaking down and more about markets resetting after extreme highs, making timing and risk management critical.

Key Takeaways

✔ Silver and gold futures plunged sharply on MCX today.
✔ Global sell-off and stronger dollar key catalysts.
✔ Margin hikes added pressure.
✔ Technical support levels suggest volatility may continue.
✔ Physical gold prices remain elevated across major Indian cities.
✔ Cautious stance recommended; long-term fundamentals remain intact.