Gold & silver prices tank up to 25% in 1 month — Buy now or wait?

The bullion market has witnessed a sharp and rapid correction over the past few weeks, with gold and silver prices falling steeply from their recent highs. The decline has triggered panic among investors, as both metals have erased a significant portion of their gains in a short span.

In the past month, bullion futures have seen a steep correction. Silver May futures have dropped to Rs 2,02,131, falling Rs 67,803 or nearly 25 per cent.

Gold April futures have also declined, slipping to Rs 1,31,659, down Rs 26,200 or about 16.5 per cent during the same period.

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The selling pressure intensified further in the latest session. Gold April futures are currently trading at Rs 1,31,659, down Rs 12,833 or 8.88 per cent in a single day.

Silver May futures have fallen to Rs 2,01,435, declining Rs 25,337 or 11.17 per cent during the session.

The steep fall reflects continued selling pressure across the bullion segment.

Sharp fall triggers panic selling

On Monday, Gold April futures witnessed sharp intraday volatility, moving between a low of Rs 1,29,595 and a high of Rs 1,48,457. This marks a swing of Rs 18,862, or nearly 14.6 per cent from the day’s low.

On a broader basis, the contract has traded between a 52-week low of Rs 1,01,107 and a high of Rs 1,93,096, indicating a wide annual range of Rs 91,989, or about 91 per cent.

Similarly, Silver futures saw sharp intraday movement, trading between a low of Rs 1,99,643 and a high of Rs 2,40,000. This reflects a swing of Rs 40,357, or about 20.2 per cent from the day’s low.

On a broader basis, the contract has moved between a 52-week low of Rs 1,09,764 and a high of Rs 4,39,337, indicating a wide annual range of Rs 3,29,573, or nearly 300 per cent.

Liquidity crunch and strong dollar weigh on prices

Market experts attributed the fall to a liquidity crunch and rising demand for the US dollar. Anindya Banerjee said, “The current situation reflects a liquidity crisis. Investors are selling all asset classes to raise cash as dollar demand has surged.”

He added that elevated crude oil prices are also adding pressure on bullion. “If crude oil prices remain elevated, gold could fall towards Rs 1,20,000 and silver to Rs 1,80,000–Rs 1,85,000,” he said.

The US Federal Reserve’s hawkish stance has also played a key role. Signals of limited rate cuts in 2026 and the possibility of rate hikes have strengthened the dollar, reducing the appeal of non-yielding assets like gold and silver.

ETF inflows have weakened as well, with emerging outflows adding further pressure on prices.

Experts warn of further downside

Analysts believe the correction may not be over yet and caution against aggressive buying at current levels. Prathamesh Mallya said, “This is a falling knife scenario. Trying to catch the bottom can be risky. The downward trend may continue for some time.”

Manoj Jha said the earlier rally in bullion was driven by excessive optimism. “The rally seen in gold and silver over the past one-and-a-half years was driven by over-excitement. It was not fully justified,” he said.

He added, “The current fall is not surprising. More profit booking may still be pending. Investors should avoid rushing in.”

Kishore Roonwal also indicated further downside risks. “The pattern suggests further downside. Gold may move towards Rs 1,30,000, while silver could trade between Rs 1,80,000 and Rs 2,00,000,” he said.

Why is silver falling more than gold?

The recent fall in silver prices is being driven by multiple global factors. Geopolitical tensions involving the US and Israel have added to uncertainty in financial markets. Rising crude oil prices have increased inflation pressure, while expectations of near-term US interest rate cuts have weakened.

At the same time, demand for safe-haven assets like gold and silver has declined. A stronger US dollar and higher bond yields have further shifted investor preference towards dollar assets.

In contrast, during 2011, the Eurozone debt crisis had supported safe-haven demand, helping silver prices rally sharply to multi-year highs.

Experts pointed out that silver tends to be more volatile than gold and often amplifies price movements. Manoj Jha said, “Gold gives direction, while silver accelerates the move. That is why the fall in silver is sharper.”

Anindya Banerjee added that during periods of liquidity stress, fundamentals take a back seat. “Investors sell everything to raise cash. However, once conditions stabilise, silver may see a sharp rebound,” he said.

Looking back, silver had earlier seen a major rally in 2011, when prices surged by more than 100 per cent. On 25 April 2011, silver reached Rs 75,020 in the domestic market and touched USD 50 on COMEX, marking a 31-year high at that time. It took nearly 15 years for silver to revisit similar levels again, and in 2025, it once again moved close to the USD 50 mark on global markets.

Gold and silver outlook

The broader trend remains weak in the near term. From their January 27 highs, silver has plunged nearly 50 per cent, while gold has declined around 25 per cent within just 53 days, according to Ajay Suresh Kedia.

On MCX, silver has fallen from Rs 4,20,048 to around Rs 2,06,000 levels, while gold has declined from Rs 1,80,779 to near Rs 1,35,000. Ajay Suresh Kedia said, “The near-term outlook remains weak, with further downside possible if current trends continue.”

Gold could test levels around Rs 1,15,000, while silver may slide towards USD 50, which translates to around Rs 1,75,000 on MCX, he said.

What should investors do now?

Experts have advised caution and patience at current levels. Anindya Banerjee said, “Long-term investors can start gradual buying, but without leverage and preferably through ETFs.”

Prathamesh Mallya advised traders to follow the trend rather than attempting to pick bottoms. Manoj Jha said, “Investors should remain patient as the correction may not be over yet.”

Kishore Roonwal recommended that new investors stay on the sidelines for now. “New investors should stay away and wait for stability before entering the market,” he said.

The sharp correction in bullion has unsettled investors, with volatility remaining high. Experts said disciplined and cautious strategies will be key until clearer signs of stability emerge.