The much-awaited day for investors and analysts in the precious metals market arrived. On Friday, January 30, 2026, the long-awaited correction in the gold and silver prices occurred. The big spike and parabolic rise in gold and silver prices had led to speculation that an equally sharp drop is imminent, which investors saw on Friday.
Gold, Silver Rates in India
Gold has fallen by more than $1,100 from its all-time high, while silver has dropped by almost $50.
As of February 2, gold was down 25% from its all-time high of $5,602.23, while silver had lost nearly 40% from its all-time high of $121.
Gold and silver prices continued to decline on Monday. In the international market, gold is trading around $4,500, down 7.7%, while silver has lost ground, trading at $72, down 14%.
In the Indian markets, MCX gold futures are trading at roughly Rs 1,40,999, down 4.57% from the 02APR2026 contracts. The silver 05MAR2026 contracts are trading 9% down at Rs 2,41,744.
Gold and Silver ETFs listed on Indian stock exchanges fell up to 20%. Prices of all silver ETFs, including Tata Silver Exchange Traded Fund, Aditya Birla Sun Life Silver ETF, Edelweiss Silver ETF, Mirae Asset Silver ETF, Nippon India Silver ETF, HDFC Silver ETF, ICICI Prudential Silver ETF, were down between 7% and 20% on Monday.
Gold, Silver Rates in International Markets
In its largest intraday slide since the early 1980s, gold dropped more than 7% to go below $4,500 per ounce. Silver dropped as high as 12%, to trade around $74, as the selloff raced through the broader metals markets.
Analysts maintain that despite significant selling pressure, the overall market uptrend remains intact. While cautioning investors against buying in haste and without a plan, they expect this correction to be followed by a rebound.
“I still believe several gold-supportive drivers remain in place, but after the strong rally in recent weeks, a consolidation is healthy,” said UBS analyst Giovanni Staunovo to Reuters.
Since 2023 January, over the last three years, gold is up 200%, silver up 366%. On Friday, gold dropped 10%, to close at $4,887, while silver slumped nearly 27% to close at $84.
Why Prices Crashed
Starting with the geopolitical tensions, the trade wars, central banks’ love for gold and then the de-dollarization and the concerns around the Federal Reserve’s independence, the tailwinds kept the momentum going for the precious metals.
What now? Is the gold and silver market done and dusted?
Before that, let us see why metals crashed. The news came that Trump is going to nominate Kevin Warsh for Fed chair, which was later confirmed, too. Warsh’s taking over the affairs at the central bank was looked upon as a move to strengthen the falling dollar. The US dollar has been down 10% in the last year.
However, it could be too early for some real action on the ground. A few days back, Trump indicated that he is comfortable with a weak dollar, as that will boost exporters. Also, Trump wants the Fed to cut rates aggressively, while Warsh is known to be against QE. How things unfold over the next few weeks or months remains to be seen. While reports of Warsh’s nomination could have been a trigger, a correction in the gold and silver was overdue.
Even after Friday’s pullback, gold still registered a monthly gain of 13% while silver was up 19% for the month. “We see gold dipping far lower than today but see a recovery and an average of $5,375 for 2026, reaching a peak of $6,400 during the fourth quarter,” said independent analyst Ross Norman.
“Although a significant part of the move in the rise in silver has been based upon sound fundamentals, there was clearly a speculative excess within the market and I think that’s getting blown off,” Norman added.
With gold and silver prices significantly increasing this year, technical indicators have raised caution. The relative-strength index (RSI) for both metals suggests they may be overbought and due for a correction, with gold’s RSI recently reaching 90, the highest level in decades.
Chinese investors have significantly driven up purchases, causing the Shanghai Futures Exchange to implement measures to temper the rising prices in precious metal markets. There were reports that trading was halted in gold funds in China.
The silver/gold ratio has climbed from the low of 49 to 58, after silver witnessed a big slump on Friday. Matthew Piggott, Director of Gold and Silver at Metals Focus, described January’s rally in the metals as irrational exuberance and said that, while extreme, he sees the current selloff as a healthy correction.
Meanwhile, UBS has raised its Gold price target to $6200 per ounce for March, June and September 2026, up from $5000.
Neil Welsh, Head of Metals at Britannia Global Markets, to Kitco, says, “I believe the broader trend remains intact. The macro forces that drove gold, silver, and copper are still firmly in place. This episode appears to be a positioning correction within an ongoing uptrend, not the end of one. In my opinion, the outlook for precious metals is to remain well supported through 2026, albeit with wider trading ranges.”