Gold and silver: Prices slipped on Friday, reversing part of the sharp gains recorded in the previous session, as traders moved to lock in profits and a firmer US dollar added pressure. The pullback followed a period of rapid appreciation that had pushed both metals to fresh highs, prompting caution among market participants.

Domestic Futures See Sharp Intraday Declines

On India’s Multi Commodity Exchange, gold futures for February delivery eased by 1.03 percent to Rs 1,67,656 per 10 grams during intraday trade around mid-morning. Silver futures for March witnessed a steeper correction, sliding 3.42 percent to Rs 3,86,200 per kilogram. The decline reflected a broader cooling after the recent surge that had drawn significant speculative interest.

Silver’s Volatility Highlights Market Nervousness

Silver prices have been particularly volatile. In the previous trading session, MCX silver had surged to a record Rs 4,20,048 per kilogram before retreating sharply by more than 6 percent to around Rs 3,75,900. Prices later recovered part of those losses, but the wide swings underscored heightened short-term uncertainty as traders adjusted positions.

Global Markets Mirror the Pullback

Internationally, spot gold prices also came under pressure, falling over 4 percent at one stage to $5,156.64 per ounce before rebounding to about $5,346.42. Despite the latest correction, gold has still posted gains of more than 20 percent so far this year. Silver has outperformed on a year-to-date basis, advancing roughly 53 percent, reflecting both investment demand and industrial usage trends.

Bullish Structure Remains Intact

Market participants noted that the broader technical structure for precious metals continues to point upward. However, the pace of the recent rally has led to short-term overheating, resulting in swift intraday swings. Analysts said the metals remain within a strong rising channel, but overbought conditions have encouraged aggressive profit taking after the sharp run-up.

Supply Constraints and Demand Support Prices

Despite near-term volatility, underlying fundamentals remain supportive. Structural supply constraints and sustained industrial demand, particularly for silver, continue to provide a bullish backdrop. Analysts believe these factors are likely to limit deeper corrections, even as traders reassess positions following the recent highs.

Key Support Levels Under Watch

For silver, market watchers identified Rs 3,75,000 per kilogram as an important support level on the domestic exchange. A sustained move below this zone could invite further selling, while holding above it may help stabilize prices in the near term.

Dollar Strength and Geopolitical Signals

The US dollar index edged higher, drawing support from the US Federal Reserve’s decision to pause interest rate hikes. A stronger dollar typically weighs on commodity prices, including precious metals. At the same time, geopolitical tensions remained elevated amid reports that US President Donald Trump is considering options related to Iran, adding a layer of uncertainty to global markets.

Investors Advised to Rebalance Exposure

A recent report from WhiteOak Capital Mutual Fund suggested that investors consider booking profits in silver and rebalancing portfolios toward diversified Indian equity funds or established blue-chip stocks. The report advised trimming precious metals holdings back to a traditional safe-haven allocation rather than chasing further upside.

Gold-to-Silver Ratio Signals Caution

The same report highlighted a sharp contraction in the gold-to-silver ratio, now near 46:1 compared with a 10-year average of around 80:1. Such a shift indicates that silver has outpaced gold significantly, reinforcing calls for caution and disciplined portfolio reallocation amid elevated price levels.