{"id":20813,"date":"2026-02-05T17:34:58","date_gmt":"2026-02-05T12:04:58","guid":{"rendered":"https:\/\/trending.niftytrader.in\/?p=20813"},"modified":"2026-02-05T17:34:58","modified_gmt":"2026-02-05T12:04:58","slug":"silver-etfs-slide-as-mcx-prices-tumble-why-the-white-metal-is-suddenly-under-pressure","status":"publish","type":"post","link":"https:\/\/www.niftytrader.in\/markets\/silver-etfs-slide-as-mcx-prices-tumble-why-the-white-metal-is-suddenly-under-pressure\/","title":{"rendered":"Silver ETFs Slide as MCX Prices Tumble \u2014 Why the White Metal Is Suddenly Under Pressure"},"content":{"rendered":"

Silver ETFs Sink Up to 18% as Precious Metals Rally Loses Steam<\/p>\n

A sharp reversal in precious metals prices rattled commodity-linked investments on Thursday, with silver exchange-traded funds (ETFs) plunging up to 18% and gold ETFs falling around 5%. The decline came as gold and silver futures on the Multi Commodity Exchange (MCX) witnessed heavy selling, erasing gains from the previous two sessions.<\/p>\n

The sudden fall surprised many short-term traders who had turned optimistic after a brief rebound in bullion prices. Instead, Thursday\u2019s session highlighted how quickly momentum can fade in volatile commodity markets. For investors holding gold and silver ETFs as hedges or tactical bets, the correction translated into notable mark-to-market losses.<\/p>\n

Gold and Silver Prices See Sharp Correction on MCX<\/h2>\n

The weakness in ETFs mirrored the fall in underlying futures prices. On MCX, gold futures for April expiry dropped about 3% to \u20b91,48,455 per 10 grams. Contracts for June delivery also fell by a similar margin, showing broad-based selling across maturities.<\/p>\n

Silver saw a far steeper correction. Silver futures for March expiry plunged 11% to \u20b92,39,000 per kilogram, while May contracts also declined around 11%. Such double-digit moves in a single session are relatively rare in bullion and indicate aggressive unwinding of positions.<\/p>\n

Market participants said the fall reflects a mix of profit booking, global cues and shifting expectations around US monetary policy. After a strong run-up earlier, precious metals had entered overbought territory, making them vulnerable to corrections.<\/p>\n

Also Read : Bears Return After a Brief Rally \u2014 What\u2019s Dragging Markets Lower and Why Sentiment Has Turned Cautious<\/a><\/p>\n

Silver ETFs Bear the Brunt as Prices Correct<\/h2>\n

Silver ETFs reacted sharply to the fall in futures prices. Kotak Silver ETF dropped nearly 18%, making it one of the biggest losers in the commodity ETF space for the day. Edelweiss Silver ETF fell over 15%, while several others\u2014including funds from Mirae Asset, UTI, Axis, ICICI Prudential and HDFC\u2014declined 12\u201314%.<\/p>\n

Gold ETFs also slipped, though the damage was comparatively limited. Motilal Oswal Gold ETF declined around 5.5%, while ETFs from Edelweiss, DSP, SBI, Axis and ICICI Prudential fell roughly 5%.<\/p>\n

The sharp fall highlights the direct linkage between ETF prices and underlying commodity futures. When bullion prices move quickly, ETFs tracking them reflect the same volatility almost instantly.<\/p>\n

Global Data and Fed Rate Expectations Drive Sentiment<\/h2>\n

Analysts say global macro cues played a major role in Thursday\u2019s correction. Markets are now focused on US ADP non-farm payroll data and services PMI readings from major economies. However, the primary trigger on traders\u2019 radar is Friday\u2019s official US jobs report, which could influence expectations on Federal Reserve rate cuts.<\/p>\n

Kaynat Chainwala, AVP \u2013 Commodity Research at Kotak Securities, said:<\/p>\n

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\u201cMarkets are now focused on US data, but the main focus remains on the official US jobs report for signals on the timing of the next Federal Reserve rate cut.\u201d<\/p>\n<\/blockquote>\n

She added that CME FedWatch currently shows no easing priced in until May, with June reflecting only a narrow probability of a 25-basis-point cut. Higher-for-longer rate expectations typically weigh on gold and silver because they raise the opportunity cost of holding non-yielding assets.<\/p>\n

Analysts Call It a Cooling Phase, Not a Trend Reversal<\/h2>\n

Some market experts view the sell-off as a healthy correction rather than the start of a prolonged downtrend.<\/p>\n

Abhinav Tiwari, Research Analyst at Bonanza, described the move as a \u201cflash crash\u201d triggered by a hawkish US Fed nominee and increased margin requirements.<\/p>\n

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\u201cThis is viewed by many as a necessary cooling of overbought markets rather than a trend reversal,\u201d he said.<\/p>\n<\/blockquote>\n

He noted that the long-term outlook for precious metals remains structurally supportive due to central bank buying, silver\u2019s supply deficit and ongoing geopolitical tensions.<\/p>\n

Siddharth Srivastava, Head \u2013 ETF Product & Fund Manager at Mirae Asset Investment Managers (India), added:<\/p>\n

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\u201cWe have maintained a cautious stance on silver following its parabolic move and suggested trimming overallocation. Currently, we prefer gold from a relative risk-reward perspective.\u201d<\/p>\n<\/blockquote>\n

Here\u2019s What Happened Today and Why Traders Reacted<\/h2>\n

Thursday\u2019s price action was driven by fast-changing global cues and positioning adjustments. Traders who had built long positions during the rebound rushed to book profits as prices started slipping.<\/p>\n

Key triggers behind the reaction:<\/strong><\/p>\n