GoldPrice – Bullion Markets Turn Volatile After Record Rally

Gold and silver prices witnessed sharp fluctuations on February 6 after a strong rally in recent sessions, with both metals slipping from recent highs and struggling to establish a clear direction. The sudden swings have left investors cautious, even as the broader market structure remains supportive.

At the time of reporting, gold was trading at Rs 1,52,624, reflecting a modest gain of 0.36 percent. Silver, however, declined 2.61 percent to Rs 2,37,456. The contrasting movement highlights the uneven momentum that has emerged following a steep correction from record peak levels.

Market Movement After Record Highs

Analysts point out that the recent weakness follows a sharp pullback from all-time highs, though the long-term outlook for bullion remains constructive. According to Ponmudi R, CEO of Enrich Money, gold futures on MCX are currently hovering between Rs 1,49,000 and Rs 1,55,000 after retreating significantly from earlier peaks near Rs 1,80,000–Rs 1,81,000.

He noted that despite short-term instability, the broader trend continues to show resilience. Prices are holding above major long-term support levels, with strong buying interest observed in the Rs 1,37,000–Rs 1,42,000 range. This suggests that underlying demand remains intact even during periods of correction.

Ponmudi added that if gold establishes a firm base within the current zone and breaks above Rs 1,55,000–Rs 1,60,000, it could renew upward momentum. In such a scenario, prices may gradually move toward Rs 1,65,000–Rs 1,75,000, keeping the medium-term outlook positive.

Silver Sees Deeper Correction

Silver has experienced even sharper swings. Futures are now trading in the Rs 2,30,000–Rs 2,50,000 range, following a steep decline from record highs around Rs 4,20,000. Despite the heavy correction, the long-term bullish framework remains largely undisturbed.

Analysts believe that declines toward key support levels could attract positional traders looking to accumulate at relatively lower prices. However, volatility in silver tends to be more pronounced due to its dual role as both a precious and industrial metal.

Global Cues Weigh on Sentiment

Meanwhile, Hareesh V, Head of Commodity Research at Geojit Investments Limited, said the recent turbulence was triggered by a combination of global factors. Hawkish expectations surrounding the US Federal Reserve, along with the nomination of Kevin Warsh, strengthened the US dollar and dampened investor appetite for bullion.

In addition, sharp margin hikes by CME forced leveraged traders to unwind positions rapidly. Profit booking after record highs further intensified price swings, leaving overall sentiment fragile.

Investment Strategy in Volatile Phase

Hareesh advised investors to avoid reacting impulsively to short-term price movements. According to him, margin revisions, profit-taking and policy uncertainty can create temporary turbulence but do not necessarily alter long-term fundamentals.

He suggested that a gradual and staggered accumulation strategy may help investors manage timing risks. Broader factors such as geopolitical tensions, steady central bank purchases and currency pressures continue to offer structural support to precious metals.

Monitoring the dollar index and upcoming signals from the Federal Reserve will remain critical in the coming weeks. Analysts also recommend maintaining balanced exposure and avoiding excessive leverage during this volatile period.

As gold and silver search for stability after an exceptional rally, market participants are likely to remain watchful. The coming sessions may determine whether the recent correction evolves into a deeper consolidation phase or sets the stage for renewed upward momentum.