Gold and Silver Bounce Back After Historic Drop! Precious Metals Regain Ground Amid Market Volatility 

Advertisment

Gold and silver prices went up on Monday after seeing a very sharp fall last week. The fall was the biggest in many decades and shocked the market. After heavy selling, buyers slowly returned, helping prices recover. Still, markets remain nervous and cautious.

In early Asian trade, spot gold rose by nearly 1%. Earlier in the day, gold had dropped around 4%. Spot silver showed a stronger recovery. Prices jumped more than 8% to around $84 per ounce after falling almost 12% at one stage. These quick moves showed how unstable prices remain.

Biggest Crash Shocks Precious Metals Market

Last week’s fall marked the biggest one-day crash in gold and silver prices since 1980. This came after a long rally. Over the past year, precious metals have reached record highs. Investors moved money into gold and silver due to global tensions, weak currencies, and worries about central bank policies.

Advertisment

Several factors triggered the sudden fall. The US dollar experienced a sudden increase, which made gold and silver products less attractive. The political situation in the United States became more intense after Kevin Warsh received his nomination to become the next Federal Reserve chair. He maintains a reputation for maintaining tight control over inflation.

Before the crash, gold prices touched record levels above $5,500 per ounce. Silver prices climbed even faster and crossed $121 per ounce. Such fast gains encouraged traders to book profits. Heavy buying in options had also pushed prices higher earlier. When selling started, prices fell quickly.

Experts Warn of Continued Price Swings

Even after the rebound, experts expect price swings to continue. Gold remains a safe option during uncertain times. Analysts believe gold prices may stay firm as long as global risks remain high. Technical signals show strong support near current levels, which may limit further sharp falls.

Advertisment

Silver remains riskier than gold. Its price depends on both investment demand and industrial use. Industries like electronics, solar power, and manufacturing play a key role. This makes silver prices move faster when global growth worries rise.

Indian Market Tracks Global Trends

In India, local prices followed global trends. Gold traded near Rs. 16,057 per gram in cities like Hyderabad. Prices stayed lower than late January highs. Silver traded around Rs. 320 per gram after a sharp fall from recent peak levels. The Union Budget kept import duties unchanged, which reduced buying interest.

Looking ahead, analysts predict that market conditions will remain unstable throughout the upcoming period. Price movements will follow the patterns established by global events, US policy signals, dollar movements, and inflation data. 

Advertisment

The demand for safe assets will gradually strengthen gold gains.  Silver needs steady industrial demand to show a stronger and more stable recovery.