Silver prices have come under sharp pressure after a historic rally, rattling investors who had grown accustomed to near one-way gains. On the Multi Commodity Exchange (MCX), silver futures fell to around ₹2,37,000–₹2,38,000 per kg, following a previous close of ₹2,32,723, reflecting a steep correction from record highs.
Market participants say the sudden decline has lifted volatility and raised questions about whether the rally has peaked. However, experts believe the move looks more like a technical correction than the start of a prolonged downtrend.
According to Ponmudi R, CEO of Enrich Money, the decline is driven by short-term factors rather than weakening fundamentals. Higher margin requirements, forced deleveraging, year-end tax harvesting, and thin liquidity have combined to accelerate selling. Leveraged traders were compelled to cut positions, while profit booking magnified price swings.
Technically, silver is finding initial support near the rising channel and the 20-day moving average. If MCX prices hold above ₹2,36,000, a rebound toward ₹2,45,000–₹2,60,000 is possible. A decisive break lower could extend pressure.
The weakness mirrors global markets. On COMEX, silver dropped over 7% in a single session, sliding from $82–$84 per ounce to about $72–$72.30. Analysts point to tighter margin norms and risk controls introduced by the Chicago Mercantile Exchange (CME), which triggered forced unwinding—often described by traders as the “CME margin card.”
Technically, a bearish engulfing pattern suggests short-term weakness, but as long as $70.40 holds, the move remains corrective. A break below that level could open a slide toward $65, while a move above $78.67 would revive bullish momentum.
Experts advise caution, not panic. Volatility may persist as leverage unwinds, but silver’s longer-term case—supported by industrial demand and supply constraints—remains intact. Long-term investors may consider staggered accumulation on dips, while short-term traders should watch key support levels and avoid excessive leverage until markets stabilize.
