Gold and Silver Prices Plunge 40%, Is Now the Right Time to Buy or Should You Wait?

New Delhi: Precious metals are witnessing extreme volatility, swinging sharply within a single day. Gold is currently down nearly 23% from its all-time high, while silver has fallen roughly 40% from its peak. The sudden swings have left investors wondering: is this the right moment to invest, or should one wait for further declines?

Recent Price Movements

On the MCX, April gold futures surged over 2% to ₹1,55,374 per 10 grams, recovering from recent losses due to short-covering amid global uncertainty. March silver futures rose nearly 3% to ₹2,50,300 per kilogram.

Internationally, spot gold jumped 3.9% to $4,954.92 per ounce, reclaiming losses from earlier sessions, while spot silver soared 8.6% to $77.33 per ounce after dipping below $65 earlier in the day. Despite these intraday gains, silver remains on track for a weekly decline exceeding 8.7%.

Drivers Behind the Rally

The recent rebound in precious metals was primarily driven by:

• A 0.2% drop in the US Dollar Index, making dollar-denominated bullion more attractive to international buyers.
• Expectations of interest rate cuts by the US Federal Reserve, supported by a fall in one-year inflation expectations to 3.5%, the lowest since January 2025.
• Positive geopolitical signals from initial US-Iran negotiations, though future talks remain uncertain.

According to Ponmudi R, CEO of Enrich Money, “Profit booking, a strong US dollar, and rising real yields drove recent declines. However, fundamentals remain supportive in the long term, including central bank buying, limited mine supply, robust industrial demand—especially for silver—and ongoing geopolitical and currency diversification trends.”

Is It the Right Time to Buy?

Ponmudi believes metals are stabilizing after last week’s sharp sell-off. He added that the medium-to-long-term bullish structure remains intact, with the recent correction helping to unwind excess leverage from January’s rally.

• Gold: MCX gold is stabilizing post-correction in the ₹1,78,000–₹1,80,000 range, with strong demand emerging around ₹1,50,000–₹1,55,000.
• Silver: MCX silver has corrected near ₹2,30,000–₹2,35,000, a historically strong zone tied to physical and industrial buying. A decisive breakout above ₹2,60,000 could trigger a fresh rally towards ₹2,75,000–₹2,90,000+.

Market Sentiment and Technical Levels

Jatin Trivedi, VP Research Analyst at LKP Securities, noted that key US data releases this week have kept traders slightly cautious. Prices have found support around $4,800 (CME) and ₹1,49,000 (MCX) for gold, while immediate resistance is seen near $4,925 and ₹1,55,000, suggesting continued volatility near major data triggers.

Investors are therefore advised to monitor technical support levels and global cues, as gold and silver continue to present both opportunity and risk in a highly volatile market environment.