Silver prices plunged sharply on Thursday, bringing an abrupt end to a powerful rally that had taken the metal to record highs just days earlier. The sudden reversal, seen across both domestic and global markets, has sparked concerns that the recent surge may have been driven by excessive speculation.
Market participants are now debating whether the fall is a temporary correction or the start of a more sustained downturn in precious metals.
The sell-off was visible in both Indian and overseas markets.
• On the MCX, silver fell nearly 9 percent to an intraday low of ₹2,44,654 per kg
• Gold prices declined about 3 percent to ₹1,48,455 per 10 gram
• On COMEX, silver crashed over 16 percent to $73.415 an ounce (around ₹6,645)
• COMEX gold slipped 3.6 percent to $4,805 an ounce (about ₹4,350)
• In Asian trade, silver hovered near $73.6 an ounce (₹6,660), while gold fell below $4,972 (₹4,500)
The fall followed profit-booking by traders as the dollar strengthened and geopolitical tensions between the US and Iran eased slightly.
The correction looks especially severe because it comes after an extraordinary run-up in prices over the past month.
• Spot silver hit a record high of $121.64 an ounce last week (around ₹11,010)
• Gold climbed to an all-time peak of $5,594.82 an ounce (about ₹5,065)
The rally was driven by a mix of speculative buying, geopolitical uncertainty and concerns over the future direction of US monetary policy. As prices climbed rapidly, many investors chose to lock in profits, triggering heavy selling late last week.
Some market watchers have drawn parallels with the Hunt Brothers episode of the late 1970s, when two US investors attempted to corner the silver market.
• Silver prices surged from around $6 to nearly $50 an ounce by 1980
• Exchanges later raised margin requirements
• The move triggered a sharp crash known as ‘Silver Thursday’, wiping out much of the gains
While today’s market structure is very different, the episode serves as a reminder of how quickly speculative rallies in commodities can unwind.
Analysts say the next few sessions will be critical in deciding the near-term trend.
According to market strategist Amit Goel, gold could attempt another upward move only if it closes above $5400 an ounce. For silver, a sustained close above $95 an ounce (around ₹8,600) would be needed to signal renewed strength.
Until those levels are crossed, caution remains the dominant theme. Experts warn that any short-term rebound may be limited and advise investors to use price recoveries to book profits or exit positions, rather than chasing fresh highs.
For now, the sharp fall has shifted the focus from record prices to risk management, as markets reassess how much of the precious metals rally was driven by fundamentals — and how much by speculation.