Gold and Silver Prices Stage Strong Recovery After Last Week's Steep Decline
Gold and silver prices have rebounded significantly on Monday, marking a strong recovery after last week's sharp crash in both international and domestic markets. The precious metals showed renewed strength as investors returned following the recent correction.
MCX Futures Show Impressive Gains
Gold and silver futures opened strongly on the Multi Commodity Exchange (MCX), recovering substantially from last week's decline. During the final two trading sessions of the previous week, silver had experienced a dramatic drop of nearly 10%, while gold saw a more moderate correction of approximately 2%.
On Monday, MCX silver futures for March 5, 2026, delivery gained an impressive 4%, rising by Rs 10,000 to reach Rs 2,59,887 per kilogram. Simultaneously, gold futures for April 2, 2026, delivery increased by Rs 3,049, representing a 2% gain, to trade at Rs 1,58,500 per 10 grams.
Global Market Performance and Analyst Insights
In international commodity markets, gold prices were trading around the $5,000-per-ounce mark. Prices climbed up to 1.7% on Monday, recovering nearly half of the losses incurred after retreating sharply from the record high recorded on January 29.
Silver continued to demonstrate greater volatility, with price movements intensified by speculative activity and relatively limited over-the-counter trading volumes. After dropping by more than one-third from its peak level, the metal gained as much as 5% on Monday, moving back above $80 per ounce.
According to Manoj Kumar Jain of Prithvi Finmart, gold is likely to maintain support near $4,555 per troy ounce on a closing basis, while silver could hold above $65 per troy ounce. On the MCX, he estimates gold support at Rs 1,54,000–Rs 1,51,800 and resistance at Rs 1,57,700–Rs 1,60,000.
Trading Recommendations and Market Analysis
Jain advises accumulating gold within the 154,000–152,000 band, keeping a stop loss below 150,500, with upside targets of 156,800–159,000. For silver, he suggests buying in the 250,000–244,000 range, placing a stop loss below 236,600, and aiming for targets of 2,55,500–2,62,000 and 2,65,500.
Market analysts believe the recent sharp surge in silver prices was not primarily driven by industrial demand. Instead, it was largely fueled by speculative buying, as investors rushed in amid fears of missing further gains. A report by Mirae Asset Mutual Fund noted that while the rally initially rested on familiar and previously credible themes, silver eventually moved well beyond its underlying fundamentals.
Historical Context and Market Dynamics
For years, silver has remained in gold's shadow, with gold continuing to dominate as the preferred safe-haven during periods of geopolitical uncertainty and concerns over weakening fiat currencies. Both investors and central banks largely favored gold during such phases.
According to Chirag Mehta, CIO at Quantum AMC, the decline in the US dollar and growing doubts surrounding its long-term reserve currency role have been key factors supporting gold's ongoing rally.
Factors Behind Last Week's Price Crash
The steep rally in recent months encouraged investors to book profits in both metals, adding to the downward pressure on prices. Multiple factors have been linked to the recent sharp correction seen in both gold and silver.
The immediate trigger was US President Donald Trump's backing of former Federal Reserve Governor Kevin Warsh as his preferred choice to replace current Federal Reserve Chair Jerome Powell. Markets view Warsh as a policy hawk inclined toward stricter control over inflation and tighter monetary policy. The dollar strengthened against major global currencies, reducing the appeal of such assets and weakening the dollar-debasement narrative.
Disclaimer: Recommendations and views on the stock market, other asset classes or personal finance management tips given by experts are their own. These opinions do not represent the views of The Times of India.
